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DEF 14A of Intel Corp
Filed Mar 31, 2023 · FY20220000050863-23-000021
Our Capital†
Our Capital† We deploy various forms of capital to execute our strategy in a way that seeks to reflect our corporate values, help our customers succeed, and create value for our stakeholders.
Our Capital†
| Capital | Strategy | Value | | Financial | Leverage financial capital to invest in ourselves and drive our strategy, provide long-term returns to stockholders, and supplement and strengthen our capabilities through acquisitions. | We strategically invest financial capital to create long-term value and provide long-term returns to our stockholders. | | Intellectual | Invest significantly in R&D and IP to enable us to deliver on our accelerated process technology roadmap, introduce leading x86 and xPU products, and develop new businesses and capabilities. | We develop IP to enable next-generation products, create synergies across our businesses, expand into new markets, and establish and support our brands. | | Manufacturing | Build manufacturing capacity efficiently to meet the growing long-term global demand for semiconductors, aligned with our IDM 2.0 strategy. | Our geographically balanced manufacturing scope and scale enable us to provide our customers with a broad range of leading-edge products. | | Human | Continue to build a diverse, inclusive, and safe work environment to attract, develop, and retain top talent needed to build transformative products. | Our talented employees enable the development of solutions and enhance the intellectual and manufacturing capital critical to helping our customers win the technology inflections of the future. | | Social and relationship | Build trusted relationships for both Intel and our stakeholders, including employees, suppliers, customers, local communities, and governments. | We collaborate with stakeholders on programs to empower underserved communities through education and technology, and on initiatives to advance accountability and capabilities across our global supply chain, including accountability for the respect of human rights. | | Natural | Strive to reduce our environmental footprint through efficient and responsible use of natural resources and materials used to create our products. | With our proactive efforts, we seek to mitigate climate and water impacts, achieve efficiencies, and lower costs, and position ourselves to respond to the expectations of our stakeholders. |
Our Capital†
In line with the International Integrated Reporting Council’s six capitals concept, we have outlined how we deploy various forms of capital to execute our strategy in a way that seeks to reflect our corporate values, help our customers succeed, and create value for our stakeholders. For additional and more detailed information with respect to each of our six capital concepts and 2022 developments, see our 2022 Annual Report on Form 10-K from which the following summary is reproduced.
Our Capital†
| | Financial Capital |
Our Capital†
We take a disciplined approach to our financial capital allocation strategy, which continues to focus on building stockholder value and is driven by our priority to invest in the business and capacity and our capital needs. We also seek to pay competitive dividends and, from time-to-time, engage in mergers and acquisitions with a focus on adjacencies and complementary technology. As we invest in our IDM 2.0 strategy and implement our next phase of capacity expansions and the acceleration of our process technology roadmap, our allocation priorities have shifted more heavily toward investing in the business and away from stock repurchases. In the long term, we will continue to look for opportunities to further our strategy through acquisitions while remaining disciplined on capital allocation. † This section is reproduced from our 2022 Annual Report on Form 10-K and speaks as of January 27, 2023.
Our Capital†
| 10 | |
Our Capital†
| | Intellectual Capital |
Our Capital†
R&D investment is critical to enable us to deliver on our accelerated process technology roadmap, introduce leading products, and develop new businesses and capabilities in the future. We seek to protect our R&D efforts through our IP rights and may augment R&D initiatives by acquiring or investing in companies, entering into R&D agreements, and directly purchasing or licensing technology. We own and develop significant IP and related IP rights around the world that support our products, services, R&D, and other activities and assets. We have intensified our focus on areas key to product leadership: process and packaging, xPU architecture, and software. Our objective with each new generation of products is to improve user experiences and value through advances in performance, power, cost, connectivity, security, form factor, and other features. We also focus on reducing our design complexity, re-using IP, and increasing ecosystem collaboration to improve our efficiency.
Our Capital†
| | Manufacturing Capital |
Our Capital†
As the guardians of Moore's Law, we continuously innovate to advance the design and manufacturing of semiconductors to help address our customers' greatest challenges. This makes possible new leadership products with higher performance while balancing power efficiency, cost, and size. Our IDM 2.0 strategy allows us to deliver leadership products using internal and external capacity while leveraging our core strengths to provide foundry services to others. IDM 2.0 combines three capabilities. First, we will continue to build most of our products in Intel fabs. Second, we expect to expand our use of third-party foundry capacity to manufacture a range of modular tiles on advanced process technologies. Third, we are building a world-class foundry business with IFS, which we expect will combine leading-edge packaging and process technology, committed capacity in the US and Europe, and a world-class IP portfolio that will include x86 cores, as well as other ecosystem IP. Our global supply chain supports internal partners across architecture, product design, technology development, manufacturing and operations, sales and marketing, and business units, and our supply ecosystem comprises thousands of suppliers globally. Our mission is to enable product and process leadership, industry-leading total cost of ownership, and on-time and uninterrupted supply for our customers. We supplement our own manufacturing capacity through our use of third-party foundries. As of the end of 2022, we had nine manufacturing sites in production — five wafer fabrication facilities and four assembly and test facilities. Our manufacturing facilities are primarily used for silicon wafer manufacturing, assembling, and testing of our platform products. We are expanding manufacturing capacity across multiple sites, including Arizona, Ireland, Israel, and Oregon, as well as New Mexico and Malaysia for advanced packaging. This year, we broke ground on our new site in Ohio and officially added Germany to our roadmap.
Our Capital†
| | Human Capital |
Our Capital†
Our human capital strategy is grounded in our belief that our people are fundamental to our success. Delivering on our strategy and growth ambitions requires attracting, developing, and retaining top talent across the world. We are committed to creating an inclusive workplace where the world’s best engineers and technologists can fulfill their dreams and create technology that improves the life of every person on the planet. We invest in our highly skilled workforce of 131,9001 people by creating practices, programs, and benefits that support the evolving world of work and our employees’ needs. Fostering a culture of empowerment, inclusion, and accountability is also core to our strategy. We are focused on reinvigorating our culture to strengthen our execution and accelerate our cadence of innovation. Our values—customer first, fearless innovation, results driven, one Intel, inclusion, quality, and integrity—inspire us and are key to delivering on our purpose. All employees are responsible for upholding these values, the Intel Code of Conduct, and Intel's Global Human Rights Principles, which form the foundation of our policies and practices and ethical business culture. We continue to see significant competition for talent throughout the semiconductor industry. Though we slowed the pace of hiring in the second half of 2022 in line with macroeconomic forecasts, financial performance, and cost-cutting measures, and took actions to rebalance our workforce, the investments we are making to accelerate our process technology require continued and focused efforts to attract and retain talent—especially technical talent. We invest significant resources to develop the talent needed to remain at the forefront of innovation and make Intel an employer of choice. 1As of December 31, 2022.
Our Capital†
| 2023 PROXY STATEMENT | 11 |
Our Capital†
Diversity and inclusion are core elements of Intel's values and instrumental to driving innovation and positioning us for growth. Over the past decade, we have taken actions to integrate diversity and inclusion expectations into our culture, performance and management systems, leadership expectations, and annual bonus metrics. We are proud of what we have accomplished to advance diversity and inclusion, but we recognize we can achieve more, including beyond the walls of Intel. We structure pay, benefits, and services to meet the varying needs of our employees. Our total rewards package includes market-competitive pay, broad-based stock grants and bonuses, an employee stock purchase plan, healthcare and retirement benefits, paid time off and family leave, parent reintegration, fertility assistance, flexible work schedules, sabbaticals, and on-site services. Our commitment to Intel's Environmental, Health, and Safety Policy is to provide a safe and injury-free workplace. We regularly invest in programs designed to improve physical, mental, and social well-being.
Our Capital†
| | Social and Relationship Capital |
Our Capital†
We are committed to engaging in initiatives that support our communities and help us develop trusted relationships with our stakeholders. Proactive engagement with our stakeholders and investments in social impact initiatives, including those aligned with the United Nations Sustainable Development Goals, advance our position as a leading corporate citizen and create shared value for Intel, our global supply chain, and our communities. The health of our business and local economies depends in part on continued investments in innovation. We provide high-skill, high-paying jobs around the world, many of which are manufacturing and R&D jobs located in our own domestic and international factories. As we expand operations in Arizona, Oregon, Ohio, and Europe, we are building a pipeline of qualified workers through our talent strategy and the many investments we are making in education. We also benefit economies through our R&D ecosystem spending, sourcing activities, employee spending, and tax payments. We make sizable capital investments and provide leadership in public-private partnerships to spur economic growth and innovation. We are committed to maintaining and improving processes to avoid complicity in human rights violations related to our operations, supply chain, and products. We have established an integrated approach to managing human rights across our business, including senior-level management involvement, with board-level oversight. We also meet throughout the year with external stakeholders and experts on human rights to continue to inform and evolve our human rights policies and oversight processes. While we do not always know, nor can we control, what products our customers create or the applications end users may develop, we do not tolerate our products being used to violate human rights. When we become aware of a concern that our products are being used by a business partner in connection with abuses of human rights, our policies require that we restrict or cease business with the third party until we have high confidence that our products are not being used to violate human rights. We actively manage our supply chain to help reduce risk, improve product quality, achieve environmental and social goals, and improve overall performance and value creation for Intel, our customers, and our suppliers. To drive responsible and sustainable practices throughout our supply chain, we have robust programs to educate and engage suppliers that support our global manufacturing operations. We actively collaborate with other companies and lead industry initiatives on key issues such as improving transparency around climate and water impacts in the global electronics supply chain and, as part of our RISE strategy, we are advancing collaboration across our industry on responsible minerals sourcing. Through these efforts we help set electronics industry-wide standards, develop audit processes, and conduct training.
Our Capital†
| 12 | |
Our Capital†
| | Natural Capital |
Our Capital†
Driving to the lowest possible environmental footprint as we grow helps us create efficiencies, support our communities, and respond to the needs of our stakeholders. We invest in environmental projects and set company-wide environmental targets to drive reductions in greenhouse gas emissions, energy and water use, and waste generation. We build energy efficiency into our products to help our customers lower their own emissions, energy usage and costs, and we collaborate with policymakers and other stakeholders to use technology to address environmental challenges. We focus on reducing our own climate change impact, and over the past two decades have reduced our direct and indirect greenhouse gas emissions associated with energy consumption. Water is essential to the semiconductor manufacturing process. We use ultrapure water to remove impurities from our silicon wafers, and we use fresh and reclaimed water to run our manufacturing facility systems. Through our RISE goals, we have committed to achieve net positive water globally. We have long been committed to waste management, recycling, and circular economy strategies that enable the recovery and productive re-use of waste streams.
Our Capital†
| 2023 PROXY STATEMENT | 13 |
Our Capital†
Proxy Voting Roadmap
Our Capital†
| 1 | Election of Directors | | | | The Board recommends that you vote “FOR” each director nominee. | | | We have built through regular refreshment an independent Board that is exceptionally engaged. Our Board possesses the necessary skills, experiences, qualifications, perspectives, and diversity to effectively oversee the business, strategic evolution, and long-term interests of our stockholders. The Board is also highly focused on understanding and responding to stockholders’ concerns. Upon the recommendation of our Corporate Governance and Nominating Committee, our Board has nominated all 12 current directors for election to serve as directors. See page 24 of our Proxy Statement u | | |
Our Capital†
| | Ratification of Selection of Independent Registered Public Accounting Firm | | | 2 | | | | | The Board recommends that you vote “FOR” this proposal. | | | The Audit & Finance Committee thoughtfully considers a number of factors in re-engaging Ernst & Young LLP (EY), which include robust independence controls and objectivity, and EY’s deep company-industry knowledge, experience, and expertise. The Audit & Finance Committee is involved in the annual review and engagement of EY and believes their continued retention is in the best interests of Intel and its stockholders. See page 62 of our Proxy Statement u | | |
Our Capital†
| | Advisory Vote to Approve Executive Compensation of Our Named Executive Officers (Say-on-Pay) | | | 3 | | | | | The Board recommends that you vote “FOR” this proposal. | | | The Compensation Committee, which was recently refreshed, seeks to design executive compensation programs that are tied to Intel’s financial and operational performance that furthers short-and long-term strategic objectives, support our commitment to strong compensation governance and pay-for-performance philosophy, and are responsive to stockholder feedback. In particular, this past year, the Committee implemented substantial and significant changes to our executive compensation programs in response to discussions with our stockholders, including making the CEO new-hire awards more challenging to achieve. See page 67 of our Proxy Statement u | | |
Our Capital†
| 14 | |
Our Capital†
| | Approval of Amendment and Restatement of the 2006 Equity Incentive Plan (EIP) | | | 4 | | | | | The Board recommends that you vote “FOR” this proposal. | | | The amendment and restatement of the EIP to increase the number of shares issuable under the EIP will be critical to not only attracting, motivating, and retaining talent but to implement our planned 2023 compensation actions. The EIP was used to grant equity awards to more than 98% of our employees in 2022. The EIP and our equity compensation programs reflect leading corporate governance practices. See page 116 of our Proxy Statement u | | |
Our Capital†
| | Advisory Vote on the Frequency of Holding Future Say-on-Pay Votes | | | 5 | | | | | The Board recommends that you vote for “ONE YEAR” on this proposal. | | | Holding annual advisory Say-on-Pay votes provides stockholders with the ability to provide frequent and timely input on the executive compensation of our named executive officers. See page 126 of our Proxy Statement u | | |
Our Capital†
| | Stockholder Proposal Requesting Executive Stock Retention Period Policy and Reporting | | | 6 | | | | | The Board recommends that you vote “AGAINST” this proposal. | | | The Board believes that the proposed policy is excessive, inconsistent with current practice among our peers, and would put Intel at a competitive disadvantage for recruiting and retaining talented executives. Intel already maintains robust stock ownership guidelines and anti-hedging policies for executive officers. Accordingly, the Board believes that this proposal is unnecessary and not in the best interests of our stockholders. See page 127 of our Proxy Statement u | | |
Our Capital†
| | Stockholder Proposal Requesting Commission and Publication of a Third Party Review of Intel’s China Business ESG Congruence | | | 7 | | | | | The Board recommends that you vote “AGAINST” this proposal. | | | The Board believes that this report would be unnecessary and a costly diversion of corporate resources given the company’s existing and comprehensive approach to corporate responsibility and environmental stewardship across our operations, our commitment to fundamental human rights and processes for promoting accountability for human rights within our supply chain, our extensive and transparent reporting on our efforts, our strong Board oversight of these topics, and the company’s focus on taking aggressive actions to reduce costs and drive efficiencies. See page 130 of our Proxy Statement u | | |
Our Capital†
| 2023 PROXY STATEMENT | 15 |
Our Capital†
| Board Overview The following provides summary information about each director nominee. | | | | | | | Age: 62 Director Since: 2021 | Patrick P. Gelsinger Intel’s Chief Executive Officer Brings 40+ years of semiconductor industry leadership experience, including extensive knowledge of Intel’s operations and culture, where he has served for over 30 years, became Intel’s first chief technology officer, and drove the creation of key industry technologies such as USB and Wi-Fi. | | | | | | Other Public Co. Boards Mobileye Global (Intel subsidiary) | Board Committees: None | Skills & Expertise: | | | Age: 57 Director Since: 2019 Partner at Sequoia Capital | James J. Goetz Brings a keen understanding of evolving technologies and a strong track record of helping companies capitalize on disruptive innovation as a long-tenured partner at a venture capital firm, as well as substantial operating experience, a growth mindset, and significant private and public company board experience. | | | | | | Other Public Co. Boards Palo Alto Networks | Board Committees: | Skills & Expertise: | | | Age: 58 Director Since: 2021 Dean of Engineering and Applied Science and Professor of Engineering at Princeton University | Andrea J. Goldsmith Brings considerable industry and technical understanding as an accomplished academic, engineer, inventor, and entrepreneur (known for her highly acclaimed foundational work in wireless communications), as well as a strong commitment to diversity and inclusion, having advocated for increased diversity in the STEM disciplines. | | | | Committees Key Qualifications | | Other Public Co. Boards Medtronic and Crown Castle International | Board Committees: | Skills & Expertise: | | | Age: 52 Director Since: 2020 Square Lead and Block Infrastructure & Information Security Lead at Block, Inc. | Alyssa H. Henry Brings 25+ years of experience in software engineering and development of database and storage technologies, which is particularly useful as Intel moves to a data-centric company and the next phase of our IDM 2.0 strategy, as well as substantial senior leadership experience where she oversaw the successful expansion of the business into other technology services. | | | | | | Other Public Co. Boards1 Confluent | Board Committees: | Skills & Expertise: | | | Age: 67 Director Since: 2017 Former Executive Chairman and Chief Executive Officer at Medtronic plc | Omar Ishrak Brings substantial experience identifying and developing emerging technologies and overseeing strategic acquisitions through his senior leadership roles in the medical technology industry, as well as a strong track record of building diverse and inclusive workplace cultures and advocating for global partnerships, having served as a member of the Board of Trustees of the Asia Society. | | | | | | Other Public Co. Boards Amgen and Compute Health Acquisition | Board Committees: | Skills & Expertise: | | | Age: 68 Director Since: 2018 Robert Wood Johnson Foundation PIK Professor Emerita at the University of Pennsylvania | Risa Lavizzo-Mourey Brings extensive leadership experience as former President and CEO at the nation's largest healthcare-focused philanthropic organization, as well as government experience from her healthcare government appointments and extensive public company board and governance experience. | | | | | | Other Public Co. Boards1 GE Healthcare Technologies, Merck, and Better Therapeutics | Board Committees: | Skills & Expertise: |
Our Capital†
1Please see page 33 for additional information with respect to the Board’s consideration of outside board commitments.
Our Capital†
| 16 | |
Our Capital†
| Age: 59 Director Since: 2016 Dean and Roy W. Carlson Professor of Engineering in the College of Engineering at the University of California, Berkeley | | Tsu-Jae King Liu Brings a wealth of industry and technical expertise directly related to Intel's semiconductor device research and development and manufacturing, as well as an innovative spirit, holding more than 90 patents and receiving numerous awards for her research (especially relevant are her contributions to the fin-shaped field-effect transistor design, dubbed "FinFET"). | | | 33% of Director Nominees Self-Identify as Women 60 years Average Age of Director Nominees 83% of Director Nominees are Independent 33% of Director Nominees Self-Identify as Having Nationality Diversity 4.3 years Average Tenure of Director Nominees 97% Average Attendance for Directors at Board and Committee Meetings in 2022 33% of Director Nominees Self-Identify as Racially/Ethnically Diverse 7 New Non-employee Directors Since 2018 49 Board (13) and Committee (36) Meetings in 2022 | | | | Other Public Co. Boards MaxLinear | Board Committees: | Skills & Expertise: | | | Age: 62 Director Since: 2022 Co-Founder, Former Vice-Chairman, and Senior Advisor at BlackRock, Inc. | | Barbara G. Novick Brings deep experience in investment, finance, and public policy, as well as broad business acumen, as the co-founder and former leader of one of the world's largest asset managers, enabling her to be a strong advocate for the interests of Intel's stockholders as Intel continues its strategic transformation. | | | | | | | Other Public Co. Boards None | Board Committees: | Skills & Expertise: | | | Age: 56 Director Since: 2017 Former CFO and Executive Vice President of Enterprise Operations at The Boeing Company | | Gregory D. Smith Brings operational and financial expertise as the former CFO of the world's largest aerospace company, including significant international experience dealing with foreign governments on market access and regulation and business development experience, having overseen the venture capital arm of Boeing. | | | | | | | Other Public Co. Boards American Airlines | Board Committees: | Skills & Expertise: | | | Age: 63 Director Since: 2022 Executive Chairman at Cadence Design Systems Inc.1 | | Lip-Bu Tan Brings software and semiconductor expertise through his leadership of a computational software company providing solutions for the design and development of complex semiconductor chips and electronic systems, as well as deep industry relationships and significant public company board experience. | | | | | | | Other Public Co. Boards Cadence Design Systems,1 Credo Technology Group and Schneider Electric | Board Committees: | Skills & Expertise: | | | Age: 55 Director Since: 2020 Former President and CEO at HP, Inc. | | Dion J. Weisler Brings technical industry knowledge and a deep understanding of the Intel customer experience as the former CEO of HP Inc., as well as valuable public company directorship experiences and a dedication to corporate responsibility, having championed diversity, inclusion, and sustainability in prior leadership roles. | | | | | | | Other Public Co. Boards Thermo Fisher Scientific and BHP | Board Committees: | Skills & Expertise: | | | Age: 59 Director Since: 2009 Principal at Darwin Capital Advisors LLC | | Frank D. Yeary Intel’s Independent Board Chair Brings investment banking and global M&A experience, through his service as a board member for numerous venture stage companies, as well as corporate governance, stockholder engagement and board best practice experience from his role in founding and leading a major corporate governance advisory firm. | | | | | | | Other Public Co. Boards Mobileye Group (Intel subsidiary) and PayPal | Board Committees: | Skills & Expertise: | |
Our Capital†
1Lip-Bu Tan will not stand for re-election and will resign from Cadence’s board as of its 2023 annual stockholders’ meeting (typically held in May). see page 33.
Our Capital†
| 2023 PROXY STATEMENT | 17 |
Key Corporate Governance Highlights
Key Corporate Governance Highlights Intel has long maintained strong Amended and Restated Board of Directors Guidelines on Significant Corporate Governance Issues (Corporate Governance Guidelines). The Corporate Governance and Nominating Committee reviews the guidelines periodically and recommends amendments to the Board as appropriate. The Board oversees administration and interpretation of, and compliance with, the guidelines and may amend, waive, suspend, or repeal any of the guidelines at any time, with or without public notice subject to legal requirements, as it determines necessary or appropriate in the exercise of the Board’s judgment or fiduciary duties. These guidelines, which investors may find on our website at www.intel.com/governance, along with our other corporate governance practices, compare favorably under the Investor Stewardship Group’s (ISG) Corporate Governance Framework for US Listed Companies, as shown in the table below.
Key Corporate Governance Highlights
| Principle 1 Boards are accountable to stockholders | ▪All directors are elected annually ▪Majority voting in uncontested director elections ▪Directors not receiving majority support tender resignation to Board for consideration ▪No poison pill ▪Proxy access with market standard terms (3% for three years, up to 20% of the Board) ▪Stockholder ability to call special meetings (15% ownership threshold) ▪Annual Board Chair’s letter in proxy statement describes Board’s activities over the past year | | Principle 2 Stockholders should be entitled to voting rights in proportion to their economic interest | ▪No dual-class share structure ▪Each stockholder is entitled to one vote per share | | Principle 3 Boards should be responsive to stockholders and be proactive in order to understand their perspectives | ▪Proactive year-round 2022 investor engagement, including participation of the Chairs of the Board and Compensation Committee with investors owning 40% of institutionally-held shares outstanding (or 26% of Intel’s outstanding shares in aggregate) ▪Engagement topics included strategy, succession planning, risk oversight, executive compensation, corporate governance, and ESG matters ▪The Board has made a number of changes in response to investor feedback that are detailed in “Stockholder Engagement” | | Principle 4 Boards should have a strong, independent leadership structure | ▪Independent Board Chair, separate from CEO ▪Board considers appropriateness of its leadership structure at least annually ▪Independent committee chairs ▪Independent directors meet in executive session at least three times per year | | Principle 5 Boards should adopt structures and practices that enhance their effectiveness | ▪83% of director nominees are independent ▪33% of director nominees are self-identified as racially/ethnically diverse, 33% are self-identified as gender diverse, 33% have self-identified diverse nationalities, and we have a policy of seeking out women and minority candidates, as well as candidates with diverse backgrounds, experiences, and skills, as part of each Board search ▪Annual Board and committee self-evaluations, including self- and peer assessment and periodic facilitation by an external third party ▪Active Board refreshment, with seven new non-employee directors joining since 2018, and seek to cap average director tenure at 10 years ▪Limits on other public company Boards, with no director permitted to serve on more than four public company boards (including Intel) or two public company boards (including Intel) if a sitting CEO or executive officer of a public company ▪No restrictions on directors’ access to management or employees ▪No non-employee director is expected to stand for re-election after age 75 without prior Board approval | | Principle 6 Boards should develop management incentive structures that are aligned with the long-term strategy of the company | ▪Compensation Committee annually reviews and approves incentive program design, goals, and objectives for our executive officers to align with compensation and business strategies ▪Annual and long-term incentive programs are designed to reward financial and operational performance that furthers short- and long-term strategic objectives |
Key Corporate Governance Highlights
| 18 | |
Overview of NEO Compensation
| | Pay Element | Purpose | 2022 Metrics & Key Features | 2023 Program Changes | | | Base Salary | Designed to be market-competitive and attract and retain talent | Compensation Committee conducted annual review of peer group and market data as to pay elements | — | | | Annual Cash Bonus | Incentivize achievement of Intel’s near-term financial and operational objectives, consistent with Intel’s longer-term goals | Payout opportunity is 0-200% of target based on: ▪For CEO, three equally weighted (1/3) performance metrics: ▪Revenue ▪Gross Margin Percentage ▪One Intel Operational Goals ▪For other NEOs, four equally weighted (25%) performance metrics: ▪Revenue ▪Gross Margin Percentage ▪One Intel Operational Goals ▪Individual Objectives and Key Results | Added Spending Reduction goal such that: ▪For CEO, four equally weighted (25%) performance metrics: ▪Revenue ▪Gross Margin Percentage ▪Spending Reduction Goal ▪One Intel Operational Goals ▪For other NEOs, five equally weighted (20%) performance metrics: ▪Revenue ▪Gross Margin Percentage ▪Spending Reduction Goal ▪One Intel Operational Goals ▪Individual Objectives and Key Results | | | Quarterly Cash Bonus | Company-wide program that rewards quarterly profitability based on Intel’s net income relative to Intel’s compensation costs | Payout (based on 5% of Net Income divided by Intel’s worldwide cost of a day’s pay) reflected as extra days of cash compensation CEO does not participate | NEOs are no longer eligible to participate. | | | | | | | | | Performance Stock Units | Designed to reward long-term profitability and long-term performance relative to peers; to create alignment with stockholders; and to facilitate executive retention | ▪Represented 80% of 2022 target long-term incentive (LTI) equity opportunity for our CEO and 50% for our other NEOs ▪Payout opportunity 0-200% of target (including modifiers) based on two financial metrics of Revenue Growth Percentage (weighted 60%) and Cash Flow From Operations (weighted 40%) that have annually set objectives, with two modifiers that can each impact the financial score %s by +/- 25 points: ▪Three-year relative TSR (where target payout requires above median performance compared to the S&P 500 Index), and ▪Three-year revenue CAGR | ▪Increased NEO (other than CEO) LTI equity mix to 60% PSUs so the majority of LTI equity opportunity is performance-based ▪Added cap for total payout at target in the event that absolute TSR is negative | | | Restricted Stock Units | Facilitates stock ownership, executive retention, and stockholder alignment | ▪Represented 20% of 2022 target LTI equity opportunity for our CEO and 50% for our other NEOs ▪Quarterly vesting over three years | ▪Adjusted NEO (other than CEO) LTI equity mix to 40% RSUs to give greater weight to performance-based PSUs ▪Changed vesting from quarterly to annual to more closely align with stockholders’ interests |
Director Nominees
Director Nominees
Director Nominees
| Patrick P. Gelsinger CEO Age: 62 Director Since: 2021 Committees None Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions As a seasoned industry veteran with over 40 years of experience in semiconductor, software, and cloud computing and data storage industries and in his role as our CEO, Mr. Gelsinger brings significant senior leadership, global, industry, human capital, sales, operating, business development and M&A, and public company board experience to the Board. Mr. Gelsinger has gained extensive operating and manufacturing, sales, emerging technologies, M&A, and information security experience from serving in a variety of senior management roles, including as CEO and COO, at leading multinational software, information security and computing companies. Having started his career at Intel, he has over 30 years of direct knowledge and experience in Intel’s culture, business development, strategy, and growth. Mr. Gelsinger also brings human capital and technical experience from his various senior leadership roles. | | | | Experience – Highlights Intel (Feb 2021-Present, 1979-2009) ▪Director and CEO (Feb 2021-Present) ▪SVP, Co-GM, Digital Enterprise Group (2005-2009) ▪SVP, CTO (2001-2005) ▪Desktop Products Group Leader (1998-2001) VMware, Inc., a cloud computing and virtualization software and services provider ▪Director and CEO (2012-2021) EMC Corp., a data storage, information security and cloud computing company ▪President and COO, EMC Information Infrastructure Products (2009-2012) | Other Public Boards Mobileye Global Inc., an autonomous driving technology Intel subsidiary Notable Affiliations Institute of Electrical and Electronics Engineers (IEEE) ▪Fellow National Academy of Engineering (NAE) ▪Member President’s National Security Telecommunications Advisory Committee (NSTAC) ▪Member | | James J. Goetz Age: 57 Director Since: 2019 Independent Committees C and M Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Mr. Goetz brings to the Board senior leadership, industry and information technology (IT), emerging technologies, business development, and cybersecurity experience from his experience as a partner of a venture capital firm, where he focuses on cloud, mobile, and enterprise technology investments, as well as providing guidance and counsel to a wide variety of internet and technology companies, and his prior work in networks, data security and storage, software, and manufacturing through various senior roles and other board experiences. Mr. Goetz’s experience with internet and technology companies brings depth to the Board in areas that are important to Intel’s business as it moves from a CPU to a multi-architecture xPU company, from silicon to platforms, and from a traditional IDM to a new, modern IDM. | | | | Experience – Highlights Sequoia Capital Operations LLC, a venture capital firm ▪Partner (2004-Present) VitalSigns Software, a software design, development, and strategy company (1996-1999) ▪Co-founder - assembled and led the team that pioneered end-user performance management Bay Networks, managed service and IT support provider ▪VP, Network Management (1989-1996) | Prior Board Memberships Barracuda Networks Inc., a data security and storage company (2009-2017) Nimble Storage Inc., a data storage company (2007-2017) Jive Software Inc., a provider of social business software (2007-2015) Ruckus Wireless Inc., a wireless (Wi-Fi) networking equipment manufacturer (2012-2015) Other Public Boards Palo Alto Networks Inc., a network security solution company |
Director Nominees
| | | | | | | | | | | | | | Senior Leadership Experience | Global/International Experience | Industry and IT/ Technical Experience | Financial Expertise | Human Capital Experience | Operating and Manufacturing Experience | Sales, Marketing, and Brand Management | Emerging Technologies and Business Models | Business Development and M&A Experience | Cybersecurity/ Information Security | Government, Legal, Regulatory, and Policy | Public Company Board |
Director Nominees
| 2023 PROXY STATEMENT | 27 |
Director Nominees
| Andrea J. Goldsmith Age: 58 Director Since: 2021 Independent Committees A Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Dr. Goldsmith brings to the Board industry and technical, emerging technologies, business development, public company, and government/regulatory experience. She is an accomplished academic, engineer, and inventor with more than two decades of experience at Stanford University and Princeton University in the fields of electrical engineering and applied science, with highly acclaimed, foundational work in wireless communications. Her research, which focused on the fundamental performance limits of wireless systems, especially with regard to 5G wireless, the mobile Internet of Things (IoT), smart grid design, and the applications of communications and signal processing to biology and neuroscience, directly relates to Intel’s data-centric business opportunities. As a Co-founder and Chief Technology Officer (CTO) of Plume WiFi and Quantenna Communications, Dr. Goldsmith gained valuable entrepreneurial, business development, and emerging technologies experience. She has significant public company board experience from her service with Medtronic and Castle Crown International and is also an advocate for increased diversity in science, technology, engineering, and mathematics (STEM). | | | | Experience – Highlights Princeton University (2020-Present) ▪Dean of Engineering and Applied Science ▪Arthur LeGrand Doty Prof. of Electrical and Computer Engineering Stanford University ▪Stephen Harris Prof. of Engineering (2012-2020) ▪Prof. of Engineering (2007-2012) ▪Associate/Assistant Prof., Department of Electrical Engineering (1999-2007) Plume WiFi (formerly Accelera, Inc.), a provider of software-defined wireless networking technology ▪Co-founder and CTO (2010-2014) Quantenna Communications (formerly mySource Communications, Inc.), a producer of silicon chipsets designed for high-speed, wireless networking ▪Co-founder and CTO (2005-2009) | Other Public Boards Medtronic plc, a medical device company Crown Castle International Corp., a real estate investment trust and shared communications infrastructure provider Notable Affiliations U.S. President’s Council of Advisors on Science and Technology (PCAST) ▪Member (Sep 2021-Present) Institute of Electrical and Electronics Engineers (IEEE) ▪Fellow ▪Founding Chair, Board of Directors Committee on Diversity, Inclusion, and Professional Ethics (2019-Present) National Academy of Engineering (NAE) ▪Member | | Alyssa H. Henry Age: 52 Director Since: 2020 Independent Committees G and M Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Alyssa Henry brings senior leadership, industry and IT, emerging technologies and business models, and information security expertise to the Board from executive experience at a mobile payment process company, including overseeing its expansion into other technology services for small businesses, and by leading the software development segment of a multinational technology company that focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence. Alyssa Henry’s more than 25 years of experience in software engineering and development of database and storage technologies is particularly useful to the Board as Intel moves from a PC-centric to a data-centric company and into the next phase of our IDM 2.0 strategy. | | | | Experience – Highlights Block Inc. (formerly Square, Inc.), a software, hardware and financial services provider for small businesses and individuals ▪Square Lead, and Block Infrastructure & Info. Security Lead (Dec 2021-Present) - leads Square, inclusive of product development and go-to-market, and Block’s technical infrastructure and information security ▪Seller Lead (2014-Dec 2021) - oversaw global engineering, product management, design, sales, marketing, partnerships, and support for Square’s seller-facing software and financial services products | Amazon Inc. (2006-2014), a multinational technology company ▪VP, Amazon Web Services Storage Services - led services including Amazon S3, Amazon EBS, and Amazon Lambda ▪Director of Software Development for Ordering - responsible for Amazon’s ordering workflow software and databases Microsoft Corporation, a multinational technology company ▪Spent 12 years working on databases and data access technologies in a variety of engineering, program management, and product unit management roles Other Public Boards1 Confluent Inc., a data infrastructure software company |
Director Nominees
1Please see page 33 for additional information with respect to the Board’s consideration of Alyssa Henry’s outside board commitments.
Director Nominees
| | | | | | | | | | | | | | Senior Leadership Experience | Global/International Experience | Industry and IT/ Technical Experience | Financial Expertise | Human Capital Experience | Operating and Manufacturing Experience | Sales, Marketing, and Brand Management | Emerging Technologies and Business Models | Business Development and M&A Experience | Cybersecurity/ Information Security | Government, Legal, Regulatory, and Policy | Public Company Board |
Director Nominees
| 28 | |
Director Nominees
| Omar Ishrak Age: 67 Director Since: 2017 Independent Committees A and G Birthplace India Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Dr. Ishrak brings senior leadership, operating and manufacturing, and international expertise to the Board from his position as former Chairman and CEO of Medtronic and his long history of success as a global executive in the medical technology industry. From his CEO roles at Medtronic and GE Healthcare, Dr. Ishrak has extensive experience identifying and developing emerging technologies and has overseen a number of strategic acquisitions, enabling him to bring business development and M&A experience to the Board. Earlier in his career, Dr. Ishrak held various product development and engineering positions at Diasonics Vingmed and Philips Ultrasound. Dr. Ishrak also provides technical, human capital, and brand marketing expertise from his role as a leader of a global medical technology company. | | | | Experience – Highlights Medtronic plc, a medical device company ▪Chairman and CEO (2011-2020 (retired)) GE Healthcare Systems, a GE Healthcare division and comprehensive medical imaging and diagnostic technology provider ▪President and CEO (2009-2011) ▪President and CEO, GE Healthcare Clinical Systems (2005-2008) ▪President and CEO, GE Healthcare Ultrasound and BMD (1995-2004) | Other Public Boards Amgen Inc., a biopharmaceutical company Compute Health Acquisition Corp., a special purpose acquisition company Notable Affiliation Asia Society, a leading educational organization dedicated to promoting mutual understanding and strengthening partnerships among peoples, leaders, and institutions of Asia and the US in a global context ▪Board of Trustees Member National Academy of Engineering (NAE) ▪Member | | Risa Lavizzo-Mourey Age: 68 Director Since: 2018 Independent Committees A, C, and G (Chair) Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Dr. Lavizzo-Mourey brings senior leadership, strategy, and human capital and talent development expertise to the Board from her leadership of the largest public health philanthropy in the US for almost 15 years and, before that, her 15 years of service as a distinguished professor and administrator at the University of Pennsylvania. She also brings to the Board government experience from her roles serving as Deputy Administrator of the Agency for Health Care Research and Quality and as a member of the White House Health Care Reform Task Force. Dr. Lavizzo-Mourey’s board service with other public companies also provides insights into board and governance best practices. | | | | Experience – Highlights University of Pennsylvania ▪Robert Wood Johnson Foundation PIK Prof., Population Health and Health Equity (2018-January 2021 (retired)) Robert Wood Johnson Foundation, nation’s largest healthcare-focused philanthropic organization ▪President and CEO (2003-2017) ▪SVP (2001-2003) University of Pennsylvania Medical School ▪Sylvan Eisman Prof., Medicine and Health Care Systems (1995-2001) ▪Director, Institute on Aging (1994-2002) ▪Chief, Geriatric Medicine (1986-1992) | Other Public Boards1 GE Healthcare Technologies Inc., a medical technology and life sciences company Merck & Co., a pharmaceutical company Better Therapeutics, Inc., a prescription digital therapeutics (PDT) company Notable Affiliations Agency for Health Care Research and Quality ▪Deputy Administrator (1992-1994) White House Health Care Reform Task Force (1993-1994) ▪Member |
Director Nominees
1Please see page 33 for additional information with respect to the Board’s consideration of Dr. Lavizzo-Mourey’s outside board commitments.
Director Nominees
| | | | | | | | | | | | | | Senior Leadership Experience | Global/International Experience | Industry and IT/ Technical Experience | Financial Expertise | Human Capital Experience | Operating and Manufacturing Experience | Sales, Marketing, and Brand Management | Emerging Technologies and Business Models | Business Development and M&A Experience | Cybersecurity/ Information Security | Government, Legal, Regulatory, and Policy | Public Company Board |
Director Nominees
| 2023 PROXY STATEMENT | 29 |
Director Nominees
| Tsu-Jae King Liu Age: 59 Director Since: 2016 Independent Committees G Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions As a scholar and educator in the field of semiconductor logic and memory devices, who conducts research on advanced materials, process technology, and solid-state devices for energy-efficient electronics, Dr. Liu brings to the Board industry and technical experience directly related to Intel’s semiconductor device research and development, and manufacturing. As a Co-founder of Progressant Technologies, which was later acquired by Synopsys, Inc., and while serving on technical advisory boards for multiple start-up companies, Dr. Liu gained business development experience. Her inventions and contributions to the fin-shaped field-effect transistor design, dubbed “FinFET,” have given Dr. Liu extensive experience in semiconductors and emerging technologies. She also brings global and international experience to the Board with her work on establishing strategic international partnerships and agreements for UC Berkeley. | | | | Experience – Highlights University of California, Berkeley ▪Dean and Roy W. Carlson Prof. of Engineering, College of Engineering (2018-Present) ▪Distinguished professorship endowed by Taiwan Semiconductor Manufacturing Company, Ltd. (TSMC), Department of Electrical Engineering and Computer Sciences (2014-2018) ▪Vice Provost, Academic and Space Planning (2016-2018) ▪Senior International Officer (2016-2018) ▪Associate Dean, Academic Planning and Development, College of Engineering (2016) ▪Chair, Department of Electrical Engineering and Computer Sciences (2014-2016) ▪Associate Dean for Research, College of Engineering (2008-2012) | Progressant Technologies, a start-up company that developed negative differential resistance transistor technology (2000-2004) ▪Co-founder and President Other Public Boards MaxLinear, Inc., a semiconductor products provider for broadband communications Notable Affiliation/Accolade Center for Advancing Women in Technology ▪Board member (2014-2016) Institute of Electrical and Electronics Engineers (IEEE) ▪Fellow National Academy of Engineering (NAE) ▪Member Silicon Valley Engineering Hall of Fame ▪Inductee | | Barbara G. Novick Age: 62 Director Since: 2022 Independent Committees A and C Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Ms. Novick brings to the Board a deep understanding of the needs and perspectives of investors gained during her more than 30-year career at BlackRock. Ms. Novick also brings to the Board senior leadership and public policy experience, having led the Global Account Management Group, established the Global Government Relations and Public Policy Group to provide a voice for investors, and overseen the Global Investment Stewardship Group. Ms. Novick has substantial human capital experience and extensive expertise unlocking stockholder value from having helped grow BlackRock into one of the world’s largest asset management companies. Ms. Novick’s experience as head of BlackRock’s Global Investment Stewardship Group also provides insight into matters relating to corporate governance and stockholder engagement. | | | | Experience – Highlights BlackRock Inc., an investment and asset management company ▪Senior Advisor (Feb 2021-Present) ▪Vice Chairman (1988-Feb 2021) ▪Head of Global Investment Stewardship (2018-2020) ▪Founder and Head of Global Government Relations and Public Policy Group (2009-2021) ▪Head of Global Account Management Group (1988-2009) ▪Oversaw global business development, marketing and client services across equity, fixed income, liquidity, alternative investment and real estate products for institutional and individual investors and their intermediaries worldwide ▪Co-Founder (1988) | Other Public Boards None Notable Affiliation/Accolade Barron’s ▪Barron’s 100 Most Influential Women in US Finance (2020) |
Director Nominees
| | | | | | | | | | | | | | Senior Leadership Experience | Global/International Experience | Industry and IT/ Technical Experience | Financial Expertise | Human Capital Experience | Operating and Manufacturing Experience | Sales, Marketing, and Brand Management | Emerging Technologies and Business Models | Business Development and M&A Experience | Cybersecurity/ Information Security | Government, Legal, Regulatory, and Policy | Public Company Board |
Director Nominees
| 30 | |
Director Nominees
| Gregory D. Smith Age: 56 Director Since: 2017 Independent Committees A (Chair) Birthplace Canada Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Mr. Smith brings to the Board senior leadership, financial, strategic, operational, human capital, and global expertise from his experience as Executive Vice President and CFO of the world’s largest aerospace company, with responsibility for the company’s Enterprise Operations, Finance, Strategy, and Shared Services organizations. He led the company’s global financing arm, Boeing Capital, its corporate audit function, and its environmental, social and governance work. Mr. Smith also held a number of other key leadership roles, including Vice President of Finance, Corporate Controller and Chief Accounting Officer, and Vice President of Financial Planning and Analysis. In between his two stints at Boeing, he spent four years at Raytheon Company as Vice President of Investor Relations. Mr. Smith brings substantial international and business development experience to the Board from his enterprise performance and strategy role at Boeing. Mr. Smith’s portfolio also included Boeing HorizonX, the venture capital arm of Boeing that identifies and invests in start-ups that are developing emerging technologies and businesses in markets such as cybersecurity, AI and machine learning, and autonomous systems, among others. He also has experience in dealing with foreign governments, including on issues related to market access and the regulation of business and investment. Mr. Smith also brings operational experience to the Board, by overseeing Boeing’s manufacturing, operations, supply chain, quality and program management teams. | | | | Experience – Highlights The Boeing Company (Boeing), world’s largest aerospace company ▪CFO and EVP, Enterprise Operations (2020-2021 (retired)) ▪Led Enterprise Operations, Finance and Strategy organization ▪Managed company’s overall financial activities ▪Oversaw company’s corporate audit function, which reported directly to the board of directors ▪Drove operational excellence by overseeing the company’s manufacturing, operations, supply chain, quality, and program management functions ▪Responsible for the delivery of enterprise services across the company ▪Oversaw the company’s strengthened focus on sustainability | ▪Maintained oversight of the company’s financial performance, reporting, long-range business planning, treasury, and controller organizations, as well as investor relations. ▪CEO and CFO (Dec 2019-Jan 2020) ▪CFO and EVP, Corporate Development and Strategy (2015-2017) ▪EVP, CFO (2012-2015) ▪VP, Finance and Corporate Controller (2010-2012) ▪VP, Financial Planning and Analysis (2008-2010) Raytheon Company, an aerospace and defense conglomerate ▪VP, Global Investor Relations (2004-2008) Other Public Boards American Airlines Group, Inc., an American airline holding company | | Lip-Bu Tan Age: 63 Director Since: 2022 Non-Independent Committees M Birthplace Malaysia Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Mr. Tan served for 12 years as the CEO of Cadence Design Systems, a computational software company providing solutions used to design and develop complex semiconductor chips and electronic systems. As the founder and chairman of an international, venture capital firm and the founding managing partner of two other funds, Mr. Tan brings to the Board senior leadership, global/ international, deep industry and IT/technical, financial and investment expertise, human capital, sales and marketing, emerging technologies and business models, business development and M&A and substantial public company experience that provides insights into board best practices. | | | | Experience – Highlights Cadence Design Systems, Inc., a computational software company ▪Executive Chair of the Board 1 (Dec 2021-Present) ▪Director (2004 -Present)1 ▪CEO (2009-Dec 2021) ▪President (2009-2017) Walden International, an international venture capital firm ▪Chairman (1987-Present) ▪Founder (1987) Celesta Capital, a venture capital firm ▪Founding Managing Partner Walden Catalyst Ventures, a venture capital firm ▪Founding Managing Partner | Other Public Boards Cadence Design Systems, Inc., a computational software company 1 Credo Technology Group Holding Ltd., a connectivity solutions provider Schneider Electric SE, a digital automation and energy management company Notable Affiliation/Accolade University of California, Berkeley’s College of Engineering and Division of Computing, Data Science, and Society ▪Advisory board member Semiconductor Industry Association ▪Robert N. Noyce Award recipient, association’s highest honor (2022) |
Director Nominees
1Lip-Bu Tan will not stand for re-election and will resign from Cadence’s board as of its 2023 annual stockholders’ meeting (typically held in May). see page 33.
Director Nominees
| | | | | | | | | | | | | | Senior Leadership Experience | Global/International Experience | Industry and IT/ Technical Experience | Financial Expertise | Human Capital Experience | Operating and Manufacturing Experience | Sales, Marketing, and Brand Management | Emerging Technologies and Business Models | Business Development and M&A Experience | Cybersecurity/ Information Security | Government, Legal, Regulatory, and Policy | Public Company Board |
Director Nominees
| 2023 PROXY STATEMENT | 31 |
Director Nominees
| Dion J. Weisler Age: 55 Director Since: 2020 Independent Committees C (Chair) and M Birthplace Australia Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Mr. Weisler brings to the Board senior leadership, global/international, industry and information technology (IT), operating and manufacturing, emerging technologies, and cybersecurity experience from his more than 25 years of experience in the IT industry. From his role as the CEO of one of the world’s largest technology companies, Mr. Weisler also has financial expertise and extensive experience managing human capital and executing a business development and M&A strategy. Mr. Weisler also brings valuable governance and board-level experience from his years of service on the boards of multinational companies like HP, Thermo Fisher Scientific, and the BHP Group. | | | | Experience – Highlights HP, Inc., a computer, printer and related supplies technology company ▪President and CEO (2015-2019 (retired)) ▪EVP, Printing and Personal Systems Group (2013-2015) ▪SVP and Managing Director, Printing and Personal Systems, Asia Pacific and Japan (2012-2013) Lenovo Group Ltd., a technology company ▪VP and COO, Product and Mobile Internet Digital Home Groups (2008-2011) ▪VP and GM, South East Asia (2007-2008) Telstra Corporation Limited, a telecommunications company ▪Management positions (2002-2007) Acer Incorporated, a hardware and electronics company ▪Management positions (1987-2001) | Other Public Boards Thermo Fisher Scientific Inc., an analytical laboratory instrument manufacturer BHP Group., a mining, metals, and petroleum company | | Frank D. Yeary Independent Board Chair Age: 59 Director Since: 2009 Independent Committees G and M (Chair) Birthplace United States Skills & Expertise | Notable Experience Aligned with Intel’s Strategy and Key Board Contributions Mr. Yeary’s career in investment banking brings to the Board financial strategy and global M&A expertise, including expertise in financial reporting and experience in assessing the efficacy of M&A on a global scale, and experience attracting and retaining strong senior leaders. At Darwin Capital Advisors, Mr. Yeary has evaluated, invested in, and served as a board member for numerous venture stage companies, giving him firsthand experience identifying and developing effective business models. Mr. Yeary’s experience as Co-founder and Executive Chairman of CamberView Partners and his service on the board of PayPal provide insight into matters relating to corporate governance, stockholder engagement, and board best practices. As Vice Chancellor of a large public research university, Mr. Yeary gained extensive strategic, operational, and financial expertise. | | | | Experience – Highlights Darwin Capital Advisors LLC, a Phoenix, Arizona private investment firm ▪Principal (2012-Present) CamberView Partners, LLC, a corporate governance and stockholder engagement advisory firm ▪Co-founder and Executive Chairman (2012-2018) University of California, Berkeley ▪Vice Chancellor (2008-2012) - oversaw changes to the university’s financial and operating strategy | Citigroup Investment Banking, an investment banking and financial services company (2001-2008, 1990-1998) ▪Managing Director, Global Head of M&A (2003-2008) ▪Management Committee Member (2001-2008) Other Public Boards PayPal Holdings, Inc., a financial technology company operating an online payments system Mobileye Global Inc., an autonomous driving technology Intel subsidiary |
Director Nominees
Committee names are abbreviated as follows: A = Audit & Finance, C = Compensation, G = Corporate Governance and Nominating, and M = Mergers and Acquisitions.
Director Nominees
| | | | | | | | | | | | | | Senior Leadership Experience | Global/International Experience | Industry and IT/ Technical Experience | Financial Expertise | Human Capital Experience | Operating and Manufacturing Experience | Sales, Marketing, and Brand Management | Emerging Technologies and Business Models | Business Development and M&A Experience | Cybersecurity/ Information Security | Government, Legal, Regulatory, and Policy | Public Company Board |
Director Nominees
| 32 | |
Board’s Diversity Commitment, Advisor, and Definition
Board’s Diversity Commitment, Advisor, and Definition Our Board is committed to building a Board with diverse experiences and backgrounds. In 2014, the Board formally adopted its commitment to actively seek women and minority candidates for evaluation for the Board as part of each undertaken Board search. In connection with our Board refreshment process, the Corporate Governance and Nominating Committee seeks input from the Chief People Officer, who is responsible for Intel’s Global Diversity and Inclusion efforts. Representation of gender, race, ethnic, nationality, geographic, cultural, or other diverse perspectives expands the Board’s understanding of the needs and viewpoints of our customers, partners, employees, governments, and other stakeholders worldwide. As part of our ongoing commitment to creating a balanced Board with diverse viewpoints and deep industry expertise, we regularly add new directors to infuse new ideas and fresh perspectives in the boardroom.
Board’s Diversity Commitment, Advisor, and Definition
| Board Refreshment, Composition, and Diversity Partnerships and Candidate Sourcing | | | | Our directors reflect diverse perspectives, including a complementary mix of skills, experience, and backgrounds that we believe are paramount to our ability to represent your interests as stockholders. In the last five years, seven non-employee directors have been elected or appointed to the Board, three of whom have been self-identified women. If each director nominee is elected to the Board, after the 2023 Annual Stockholders’ Meeting, 67% of the Board would be diverse based on directors’ self-identified gender, race, ethnicity, and/or nationality. The Corporate Governance & Nominating Committee has a robust and on-going process to assess the skills and make-up of the Board. In addition to developing a skills matrix, the Committee through our stockholder engagement program receives on-going input from stockholders. In 2022, the Committee retained a leading search firm to generate candidate pools with diverse expertise, experiences, and backgrounds important to support Intel’s Board composition requirements. The Committee reviews the candidate pipeline regularly. In addition, Intel is committed to focusing on Board diversity more broadly through engagement with key partners. Intel joined the Thirty Percent Coalition (Coalition) in 2018, which has a specific focus on increasing female representation on corporate boards. In 2019, the Coalition added a specific focus on women of color. Through our partnerships, we aim to not only increase the available talent for our Board, but to also support increased female Board representation across our industry. | | | | | Board Refreshment Since 2018 | | | | 2018 2019 2020 2021 2022 | + 1 new non-employee director + 1 new non-employee director + 2 new non-employee directors + 1 new non-employee director + 2 new non-employee directors |
Board’s Diversity Commitment, Advisor, and Definition
| 2023 PROXY STATEMENT | 35 |
Board’s Diversity Commitment, Advisor, and Definition
| | 2022 | Barbara G. Novick, Co-founder, former Vice Chairman, and Senior Advisor at BlackRock Inc., one of Intel’s largest stockholders and one of the world’s largest asset managers, joined the Board. Her extensive expertise in unlocking stockholder value, accelerating transformations, and overseeing human capital and organizational development, will be very valuable as Intel has undertaken recent leadership and organizational transformations and strategic initiatives such as IDM 2.0. | | | 2022 | Lip-Bu Tan, Executive Chair of the Board and former CEO of Cadence Design Systems, Chairman and Founder of Walden International, the venture capital firm he founded in 1987, and Founding Managing Partner of Celesta Capital and Walden Catalyst Ventures, joined the Board. Mr. Tan is a global leader in the semiconductor industry. He was recently named the 2022 Robert N. Noyce award recipient, the Semiconductor Industry Association’s highest honor. He also brings significant software, venture capital expertise, deep ecosystem relationships, and public company board experience. | | | 2021 | Dr. Andrea J. Goldsmith, Dean of Engineering and Applied Science at Princeton, a member of the US President’s Council of Advisors on Science and Technology who brings technical expertise and valued government affairs and policy experience, an advocate for increased diversity in STEM, and a leading expert in wireless networking technology, joined the Board. | | | 2020 | Alyssa H. Henry, Square Lead and Block Infrastructure & Information Security Lead for Block Inc. (formerly, Square Inc.) with expertise in software, emerging technologies and business models, joined the Board. Alyssa Henry was a former executive at Amazon Web Services Storage Services (AWS), for whom Intel has historically provided data center/cloud computing services. AWS has also committed to be one of the first customers of Intel Foundry Services. | | | 2020 | Dion J. Weisler, the former President and CEO of HP, Inc., one of Intel’s three largest customers, also joined the Board. His operating, manufacturing, emerging technologies, business development, human capital and extensive industry experience spanning client, cloud, and network computing have been very valuable as Intel has undertaken recent leadership and organizational transformations and strategic initiatives such as IDM 2.0. |
Board’s Diversity Commitment, Advisor, and Definition
| Skills & Experience Mix and Focus Areas Our Board is focused on achieving the appropriate mix of skills, experience, and perspectives to support Intel’s strategic direction, including its focus on product leadership, open platforms, and manufacturing at scale. For example, we have recently prioritized various forms of semiconductor and technology industry experience and expertise, as reflected by the recent additions of Lip-Bu Tan, a semiconductor industry leader; and directors with significant technology industry experience including James Goetz, Dr. Andrea Goldsmith, Alyssa Henry, and Dion Weisler. We also recently prioritized expertise in unlocking stockholder value in our director recruitment efforts, as reflected with the recent addition of Barbara Novick to our Board. In addition, recognizing the importance of the Board’s role in overseeing human capital risks as Intel has been undergoing a leadership and cultural transformation, over the past few years we have also added directors with human capital management experience, including most recently Barbara Novick, who also brings valued investment and finance experience who can represent the interests of stockholders, and Dion Weisler, who also brings valued operating and manufacturing experience at a time when manufacturing at scale is one of our strategic priorities. | | | | | Board Diversity | | | | | 67% of non-employee director nominees have self-identified as having gender, racial, ethnic, and/or nationality diversity |
Board’s Diversity Commitment, Advisor, and Definition
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Board Committees
| 8 Committee Meetings in 2022 | | Primary Responsibilities ▪Reviews and approves salaries, bonuses, and other matters related to the compensation of our executive officers ▪Reviews and approves the performance measures and goals for our executive officers ▪Reviews and grants equity awards to our executive officers ▪Reviews and determines other compensation policies, handles many compensation-related matters, and makes recommendations to the Board and to management on employee compensation and benefit plans ▪Administers Intel’s equity incentive plans ▪Reviews input, analysis, and advice from its independent executive compensation consultant regarding Intel’s executive compensation philosophy, peer groups, pay positioning (by pay component and in total) relative to peer companies, compensation design, equity usage and allocation, and risk assessment under Intel’s compensation programs ▪Reviews Intel’s programs and practices related to executive workforce diversity and executive compensation program administration in a non-discriminatory manner ▪Oversees the company’s strategies, initiatives, and programs with respect to human capital management (e.g., company culture); talent recruitment, development and retention; employee engagement, diversity, and inclusion; and management development and succession planning for CEO & other senior leaders Member Independence The Board has determined that each Compensation Committee member is independent as defined by the Exchange Act, the SEC’s rules, and Nasdaq’s listing standards, and a “non-employee director” as defined in the SEC rules. Recent Committee Focus Areas During the past year, the Compensation Committee’s oversight focused on, among other things, | | | | Dion J. Weisler1, 2, 3, 4 (Chair) | | | | | James J. Goetz1, 3, 5 | | | | | Dr. Risa Lavizzo-Mourey1, 4 | | | | | | ▪compensation program strategy and design, including: ▪changing compensation programs (including CEO’s new-hire equity awards) to reflect stockholder feedback and increase pay-for-performance rigor, ▪creating a deliberate engagement plan to understand and decisively respond to stockholder feedback, ▪aligning annual and long-term variable pay plans to the strategy to accelerate Intel’s transformation, ▪confirming peer groups and market data to reflect highly competitive market for talent, | ▪ pay-for-performance components of compensation plans to reinforce a results-driven culture, ▪human capital management strategy to deliver talent required for the long-range plan, including: ▪organization human capital initiatives and programs, ▪recruitment and retention strategies, ▪culture and values revitalization, and ▪succession planning and leadership development. | | | Barbara G. Novick1, 2, 4, 5 | | | | 1-4 Committee member possesses above-referenced qualifications 5Joined the committee as of December 1, 2022. | | The Compensation Committee is responsible for determining compensation for Intel executives (including our CEO). The Compensation Committee can designate one or more of its members to perform duties on its behalf, subject to reporting to or ratification by the Compensation Committee, and can delegate to other Board members, or an officer or officers of the company, the authority to review and grant stock-based compensation for employees who are not executive officers. Additional Information Information with respect to the use of compensation consultants and the Compensation Committee’s process for determining executive compensation are described in “Compensation Discussion and Analysis” on page 71, “Report of the Compensation Committee” on page 98, and “Executive Compensation Tables” on page 99, in this proxy statement, and the Compensation Committee’s charter (available at www.intc.com/board-and-governance/governance-documents). | |
Director Compensation
Director Compensation The general policy of the Board is that compensation for non-employee directors should be a mix of cash and equity, with the majority of compensation provided in the form of equity. Annual Review of Director Compensation. The Corporate Governance and Nominating Committee (CGN), consisting solely of independent directors, has the primary responsibility for reviewing director compensation and considering any changes in how we compensate our non-employee directors. The CGN reviews director compensation on an annual basis, considering factors such as workload and market data. The Board annually reviews the committee’s recommendations and determines the amount of director compensation. The CGN engages the Compensation Committee’s independent compensation consultant to assist the committee with the director compensation programs. The director peer group is the same as the peer group considered by the Compensation Committee in setting executive compensation for 2022 and as of July 2022, consisted of 17 technology companies, as described in detail below under “Compensation Discussion and Analysis; External Competitive Considerations for 2022” on page 81. The committee targets cash and equity compensation at the median of the director peer group. For 2022, the Board made no changes to the annual compensation for non-employee directors from 2021. The 2022 annual compensation for non-employee directors consisted of the elements shown in the below table. Effective March 1, 2023, the Board decided to temporarily reduce by 25% the cash retainer portion of their directors’ fees, and the Chair Mr. Yeary also decided to temporarily reduce by 25% his additional Chair cash retainer fee. The Board took these actions as part of Intel’s broader cost control efforts, which included pay reductions across the board for the company’s senior leadership team through mid-level employees.
Director Compensation
| Board Fees | | | | | | Committee Fees1 | | | Independent Board Chair Fee1 | |
Director Compensation
1Paid in quarterly installments. Intel does not pay its management directors for Board service in addition to their regular employee compensation. For 2022, Mr. Gelsinger served as our employee director and did not receive any compensation for his service as a member of our Board.
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Director Compensation For Fiscal Year 2022
Director Compensation For Fiscal Year 2022 The following table details the compensation of Intel’s non-employee directors for the 2022 fiscal year.
Director Compensation For Fiscal Year 2022
| Name | | Fees Earned or Paid in Cash ($) | Stock Awards1 ($) | All Other Compensation2 ($) | Total ($) | | James J. Goetz | 3 | — | 277,400 | — | 277,400 | | Andrea J. Goldsmith | 4 | 93,800 | 198,000 | — | 291,800 | | Alyssa H. Henry | 5 | — | 299,500 | — | 299,500 | | Omar Ishrak | | 278,800 | 198,000 | 10,000 | 486,800 | | Risa Lavizzo-Mourey | | 135,000 | 198,000 | 10,000 | 343,000 | | Tsu-Jae King Liu | | 105,000 | 198,000 | 10,000 | 313,000 | | Barbara G. Novick | 6 | 28,800 | — | — | 28,800 | | Gregory D. Smith | 4 | 125,000 | 198,000 | 10,000 | 333,000 | | Lip-Bu Tan | 7 | — | 149,700 | 62,500 | 212,200 | | Dion J. Weisler | 8 | — | 298,400 | — | 298,400 | | Frank D. Yeary | 4 | 125,000 | 198,000 | 11,000 | 334,000 |
Director Compensation For Fiscal Year 2022
1With respect to all directors except Lip-Bu Tan and Barbara Novick, includes May 12, 2022, Annual Equity Award of 4,828 RSUs with a grant date fair value computed in accordance with the Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 718 and assuming a risk-free rate of return of 1.50% and a dividend yield of 3.44%. For additional information, see “RSUs in Lieu of Fees” and “Annual Equity Awards” below. 2The Intel Foundation made matching charitable contributions on behalf of Dr. Omar Ishrak ($10,000 ), Dr. Risa Lavizzo-Mourey ($10,000), Dr. Tsu-Jae King Liu ($10,000), Gregory Smith ($10,000), and Frank Yeary ($11,000). Directors’ charitable contributions to schools and universities that meet the guidelines of Intel’s employee charitable matching gift program are eligible for matching funds. Lip-Bu Tan received $62,500 in compensation in 2022 as an advisory board committee member prior to becoming a director. 3James Goetz (i) was granted 1,703 RSUs on January 31, 2022 in lieu of his annual cash retainer for 2021, with the grant date fair value computed in accordance with ASC Topic 718 and assuming a risk-free rate of return of 0.35% and a dividend yield of 3.04% and (ii) elected RSUs in lieu of his 2022 cash fees, and these RSUs were granted in January 2023. 4Dr. Andrea Goldsmith, Gregory Smith, and Frank Yeary elected to defer their 2022 annual cash compensation until their retirement from the Board. 5Alyssa Henry (i) was granted 2,176 RSUs on January 31, 2022 in lieu of her annual cash retainer for 2021, with the grant date fair value computed in accordance with ASC Topic 718 and assuming a risk-free rate of return of 0.35% and a dividend yield of 3.04% and (ii) elected RSUs in lieu of her 2022 cash fees, and these RSUs were granted in January 2023. 6Barbara Novick joined the Board on December 1, 2022 and will be granted an award of non-employee director time-based restricted stock units in the first quarter of 2023. 7Lip-Bu Tan joined the Board on September 1, 2022, and was granted 5,524 RSUs on October 30, 2022, with the grant date fair value computed in accordance with ASC Topic 718 and assuming a risk-free rate of return of 4.25% and a dividend yield of 5.12%. 8Dion Weisler (i) was granted 2,152 RSUs on January 31, 2022 in lieu of his annual cash retainer for 2021, with the grant date fair value computed in accordance with ASC Topic 718 and assuming a risk-free rate of return of 0.35% and a dividend yield of 3.04% and (ii) elected RSUs in lieu of his 2022 cash fees, and these RSUs were granted in January 2023. RSUs in Lieu of Fees. Under the “RSUs in Lieu of Cash Election” program, non-employee directors can elect to receive 100% of their cash compensation in the form of RSUs (but not less than 100%). RSUs elected in lieu of payments in cash generally vest on the one-year anniversary of the grant date. Annual Equity Awards. Each non-employee director received annual grants of RSUs with a target value on the grant date of approximately $220,000. The fair value of an RSU for accounting purposes is discounted for the present value of dividends that are not paid on RSUs prior to vesting. The grant date and vesting of the RSUs align with the intended service on the Board, from election at the annual stockholders’ meeting to the date that is the earlier of the one-year anniversary of the grant date or the date of the next annual stockholders’ meeting. All unvested RSU shares are payable upon retirement from the Board if a director is 75 years old (or 72 years for RSU awards granted prior to May 2022) or has at least seven years of service on the Board. Directors do not receive dividend equivalents on unvested RSUs. Deferred Compensation Program. This program allows non-employee directors to defer their cash and equity compensation. Under the cash deferral program, directors may defer up to 100% of their cash compensation and receive an investment return on the deferred funds as if the funds were invested in Intel common stock. Participants receive credit for
Director Compensation For Fiscal Year 2022
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Director Compensation For Fiscal Year 2022
reinvestment of dividends under this cash deferral program. Plan participants must elect irrevocably to receive the deferred funds either in a lump sum or in equal annual installments over five or 10 years, and to begin receiving distributions either at retirement or at a future date not less than 24 months from the election date. This deferred cash compensation is an unsecured obligation for Intel. The equity deferral program allows directors to defer the settlement of their vested equity awards until termination of service. Directors do not receive dividends on deferred vested equity awards.
Outstanding Equity Awards for Directors At Fiscal Year-End 2022
Outstanding Equity Awards for Directors At Fiscal Year-End 2022 The following table provides information on the outstanding equity awards held at fiscal year-end 2022 by the non-employee directors who served during fiscal 2022. Market value is determined by multiplying the number of shares by the closing price of Intel common stock on Nasdaq on the last trading day of the fiscal year unless otherwise specified.
Outstanding Equity Awards for Directors At Fiscal Year-End 2022
| | Stock Units | | | Name | Outstanding Equity Awards1,2 (#) | Market Value of Outstanding Equity Awards ($) | | James J. Goetz | 6,531 | 172,600 | | Andrea J. Goldsmith | 4,828 | 127,600 | | Alyssa H. Henry | 7,004 | 185,100 | | Omar Ishrak | 4,828 | 127,600 | | Risa Lavizzo-Mourey | 10,974 | 290,000 | | Tsu-Jae King Liu | 4,828 | 127,600 | | Barbara G. Novick | — | — | | Gregory D. Smith | 18,959 | 501,100 | | Lip-Bu Tan | 5,524 | 146,000 | | Dion J. Weisler | 6,980 | 184,500 | | Frank D. Yeary | 18,451 | 487,700 |
Outstanding Equity Awards for Directors At Fiscal Year-End 2022
1Includes (i) unvested RSUs and (ii) vested but deferred equity awards for the following directors: Dr. Risa Lavizzo-Mourey (6,146), Gregory Smith (14,131), and Frank Yeary (13,623). Awards in this column may become payable upon the director’s retirement from the Board, depending on the director’s age or length of service. 2Annual RSUs vest 100% on the earlier of the one-year anniversary of the grant date or the date of the next annual stockholders’ meeting; RSUs in lieu of cash fees vest 100% on the one-year anniversary of the grant date. Non-Employee Director Stock Ownership Guidelines. Intel’s stock ownership guidelines state that each non-employee director must acquire and hold at least five times (5x) the annual cash retainer amount within five years of joining the Board. Unvested RSUs do not count toward this requirement. Deferred RSUs count toward this requirement once they vest. As of December 31, 2022, each non-employee director nominee had met these ownership guidelines or still had time to do so. Equipment. Intel provides each non-employee director a laptop computer for personal use and offers each director the use of other equipment employing Intel technology. Travel Expenses. Our Board compensation does not include meeting fees. We reimburse our directors for their travel and related expenses in connection with attending Board and committee meetings and Board-related activities, such as Board advisory committee meetings, Intel site visits, and sponsored events, as well as continuing education programs. Given the significant value to Intel of director interactions with each other and with Intel employees, as well as the pandemic, Intel and the Board authorized the use of private chartered airfare for certain Intel-related travel by directors in 2021 and 2022.
Outstanding Equity Awards for Directors At Fiscal Year-End 2022
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Deliberate Engagement and Responsiveness to Address Stockholder Concerns
Deliberate Engagement and Responsiveness to Address Stockholder Concerns The Committee was disappointed in the outcome of the 2022 Say-on-Pay vote and our work over the last year was intensely focused on understanding and addressing the underlying concerns and perspectives of our stockholders. In the months following the 2022 Say-on-Pay vote, the Committee executed an expanded engagement program designed specifically around compensation with the goal of identifying and promptly implementing changes that would be responsive to stockholder feedback. The engagement process involved reaching out to stockholders representing approximately 75% of our institutionally-held shares and holding meetings with stockholders representing over 50% of our institutionally-held shares. Dion Weisler, Chair of the Committee, led meetings with stockholders representing over 40% of our institutionally-held shares. Our stockholders are diverse, and we appreciated the candid and constructive feedback we received that reflected their diverse perspectives. Following these meetings, the Committee acted decisively to implement a set of comprehensive changes in response to stockholder feedback that we disclosed publicly in November 2022, including: ▪Changing CEO Pat Gelsinger’s 2021 new-hire awards to increase the rigor for core components of the awards and make them more challenging to achieve; ▪Adjusting our long-term incentive program to increase the weighting of PSUs and revise the vesting schedule for RSUs, among other changes; and ▪Making forward-looking commitments and further enhancements to our compensation-related disclosures. These changes are detailed in the Compensation Discussion and Analysis in this proxy statement, and we encourage you to review the alignment between the feedback we received and the actions we have taken. In discussions with stockholders, we consistently heard affirmation that these were the right changes to address their concerns. We are confident that these changes directly address the feedback we received from stockholders and further set the foundation for strong alignment between pay and performance going forward. We will continue to engage with our stockholders on an ongoing basis and consider feedback when making decisions about our executive compensation programs.
The Compensation Committee
Compensation Discussion and Analysis This section of the proxy statement explains how the Compensation Committee of the Board of Directors oversees our executive compensation programs, and discusses the compensation earned by Intel’s named executive officers (NEOs), as presented in the “Executive Compensation Tables” section. This Compensation Discussion and Analysis has been organized into three sections: ▪Executive Summary – Provides an overview of our executive compensation programs, highlighting: ▪Stockholder responsiveness. In response to stockholder feedback, we implemented substantial and significant changes to our executive compensation programs, including increasing the rigor of our CEO new-hire equity awards and making them more challenging to achieve and making a number of forward-looking commitments ▪Deliberate engagement. The Compensation Committee led a deliberate stockholder engagement program designed specifically around compensation that identified and shaped the changes in response to stockholder feedback ▪Competitive new-hire packages. Our new-hire packages are market competitive and reflect what was needed to bring in talent; the new-hire awards for our NEOs were entirely make-whole awards designed solely to replace compensation opportunities from the executives’ prior employment - though both new hires forfeited substantial compensation from their prior employer that we did not make whole ▪Pay-for-performance alignment. Our executive compensation programs are designed to link pay to performance and recent performance-based pay outcomes demonstrate our commitment to pay for performance: our 2020 PSUs, tied to goals not aligned with our transformation strategy, did not pay out; our annual cash bonus plan paid out at less than 50% of target; and the performance-based components of our CEO new-hire equity awards currently have no “in the money” value ▪Normalized ongoing CEO compensation. Our CEO’s ongoing compensation opportunity is targeted at median of peers, reflects best practices, and has rigorous targets with outcomes aligned to our performance ▪2023 compensation reflects macroeconomic headwinds. Our CEO’s and other NEOs’ base salaries have been reduced 25% and 15%, respectively for 2023 alongside reductions for other employees, reflecting the need to cut costs in the current operating environment ▪2022 Compensation of Our NEOs - Details our compensation philosophy and framework, design of pay programs that tie pay and performance, and individual compensation of our NEOs and 2022 pay outcomes ▪Other Aspects of Our Executive Compensation Programs - Provides a summary of the 2023 NEO compensation programs and details on other policies and practices related to our executive compensation programs
Stockholder Engagement Shaped Our Response to the 2022 Say-on-Pay Vote
| What We Heard From Stockholders | Our Perspective / How We Responded | Effective As Of | | CEO New-Hire Equity Awards | | | | Structure of Awards: ▪Questions around the rigor of the performance hurdle for the performance-based stock options relative to the magnitude of pay opportunity if the awards were earned ▪Questions around the design of the new-hire performance awards relative to their magnitude, with particular concerns around whether the sustained performance period for the stock price hurdles was sufficiently long-term relative to the magnitude of pay opportunity if the awards were earned | The Compensation Committee, in agreement with our CEO, amended three of the CEO’s new-hire equity awards tied to stock price growth to further strengthen the alignment of the CEO’s new hire awards with his commitment to long-term stockholder value creation: ▪Increased the stock price hurdle from 30% to 50% of the baseline stock price over five years for Performance Stock Options (requiring a stock price of $74.47 (previously $64.54) to be exercisable) ▪Lengthened the period that stock price must be maintained at /above the stock price hurdle from 30-consecutive trading days to 90 calendar days (which is generally 60 or more consecutive trading days) for Performance Stock Options, Strategic Growth PSUs, and Outperformance PSUs ▪Lengthened the period threshold stock price must be maintained at the end of the five-year performance period from 30-consecutive trading days to 90 calendar days (which is generally 60 or more consecutive trading days) for Strategic Growth PSUs to vest in the full possible payout ▪Removed the ability for a portion of the Strategic Growth PSUs and Outperformance PSUs to vest and be paid on the third anniversary of the Grant Date. Both PSU awards will now only be paid out after five years, subject to performance These changes make the awards meaningfully more challenging to achieve and ensure that, if the full magnitude of the awards is earned, it will be based on strong performance over the entire five-year period. Positive feedback provided from stockholders regarding the changes made to the awards affirmed the Compensation Committee’s understanding that the increased rigor of the awards addressed stockholder concerns about the relationship between pay magnitude and the structure of the awards (see Appendix B on page B-1 for update on the CEO new-hire equity awards). | Immediately |
Stockholder Engagement Shaped Our Response to the 2022 Say-on-Pay Vote
| What We Heard From Stockholders | Our Perspective / How We Responded | Effective As Of | | Long-Term Incentive Design | | | | Equity Mix: ▪Desire for the majority of the long-term incentive equity awards granted to NEOs be performance based | ▪Committed to adjust the long-term incentive equity award mix for NEOs other than our CEO beginning in 2023 to 60% PSUs and 40% RSUs (from 50% PSUs and 50% RSUs), so that the majority of equity awards granted to all NEOs under the long-term incentive program are performance-based PSU awards; our CEO’s mix remains 80% PSUs and 20% RSUs | 2023 Awards | | Cap on PSU Payout: ▪Consider adding a cap when our TSR was negative | ▪Committed to add a cap at target on the total payout under our PSU awards beginning with the 2023 awards in the event our absolute TSR is negative over the performance period | 2023 Awards | | PSU Goal Setting: ▪Preference for long-term performance goals under the PSU program rather than goals with annual objectives ▪Indicated an understanding of the challenges in doing so immediately | ▪Committed to returning to multi-year performance goals for PSUs. We are in the middle of a major transformation, and the design element of having goals with annual objectives for two of the PSU financial metrics provide the Compensation Committee the ability to be flexible and agile, thereby helping manage the business in our current environment. While the Compensation Committee feels it is important and appropriate to continue to use annual objectives for the near-term, the Committee understands investor concerns and is committed to return to multi-year goals no later than 2025 | No later than 2025 | | RSU Vesting Schedule: ▪Desire for annual vesting for RSUs for our NEOs | ▪Committed to change the RSU vesting from twelve quarterly dates to three annual vesting dates beginning with 2023 awards | 2023 Awards | | Quarterly Performance Bonus Program | | | | Removal of NEOs: ▪Would like to see NEOs removed from participating in quarterly incentive cash program | ▪Removed NEOs from participation in the long-established company-wide quarterly incentive cash program that accounted for less than one percent of our NEOs’ total direct compensation | January 1, 2022 for CEO; January 1, 2023 for other NEOs | | Commitments and Enhanced Disclosure | | | | Modification of Goals: ▪Expressed strong disfavor that we modified the 2021 annual cash incentive plan goals without limiting the payout opportunity | ▪Clarified to stockholders the rationale for the 2021 modification was the hire of a new CEO and a transformational business strategy impacting the performance goals for 2021 ▪Committed that in the unlikely event that in-progress performance goals were modified in the future, payouts would be capped at target of the revised goals | Immediately |
Stockholder Engagement Shaped Our Response to the 2022 Say-on-Pay Vote
| What We Heard From Stockholders | Our Perspective / How We Responded | Effective As Of | | Appropriate Comparator Index: ▪Conflicting views regarding the appropriate comparator index for relative TSR metric under our PSU program | ▪While most of the feedback received on the topics reflected widely held or consensus views among stockholders, we encountered conflicting views from stockholders on what would be the most appropriate comparator index to use in assessing relative TSR performance, with several stockholders encouraging us to maintain the current index and several stockholders suggesting a variety of potential alternatives ▪We therefore committed to continue to annually assess the appropriate index under the PSU program if a TSR metric is used and to continue to solicit stockholder input around compensation designs for our NEOs. The Compensation Committee concluded that utilizing the S&P 500 Index with above median target (55th), which was supported by a plurality of stockholders who stated a view, remained the optimal index for comparison purposes for 2023 | Immediately | | Metric for New-Hire Inducement Awards: ▪Concerns about solely using stock price growth as a metric for future inducement awards | ▪Committed to not use stock price growth as the sole metric for any future NEO new-hire inducement awards | Immediately | | Enhanced Disclosure of Performance Goals: ▪Sought increased disclosure of performance goals | ▪Committed to further enhancing disclosures on qualitative objectives and key results of the One Intel operational goals under the annual cash incentive plan, to the extent practical without disclosing competitively harmful information. This enhanced disclosure can be found in the section "One Intel Operational Goals” on page 85, which includes a table that summarizes the categories of our One Intel operational goals (and their importance to our strategy), the high-level objectives of each of the goals under the categories, our 2022 achievements, and the points scored for each goal ▪Provided disclosure of our NEOs’ individual objectives, each individual’s performance highlights, and each individual’s score in the section “Individual Performance Goals” on page 89 | 2023 Proxy Statement |
Update on CEO New-Hire Equity Awards
Update on CEO New-Hire Equity Awards In 2021, our CEO received a package of new-hire equity awards intended to induce him to join Intel, replace forfeited equity at his prior employer, and align his incentives with stockholders. The majority of the awards require significant value creation in order to vest, and in late 2022, the Compensation Committee amended the terms of these awards that were subject to stock price growth to make them even more challenging to achieve in response to stockholder feedback. These changes increase the rigor of certain performance threshold, vesting timeline, and stock price sustainment period components of the awards, to ensure that, if the full magnitude of the awards is earned, it will be based on strong company performance over the five-year period. These awards will only deliver economic value to our CEO upon achievement of even more significant performance hurdles, as amended. As of December 31, 2022, our stock price was materially below the price initially used to set the new-hire equity award thresholds. Appendix B on page B-1 details the current status of these awards, as well as the increase to stock price and market cap that would be required for threshold vesting.
Update on CEO New-Hire Equity Awards
| | Our New Leadership Team |
Update on CEO New-Hire Equity Awards
Over the past year, the company continued to add highly experienced engineering and executive talent to accelerate Intel’s transformation. The company made a number of key changes to our leadership and executive team in 2022 to best position Intel to execute on our strategy: ▪David Zinsner joined Intel as our new Chief Financial Officer (CFO) on January 17, 2022, overseeing Intel’s global finance organization. Mr. Zinsner has more than 20 years of financial and operational experience in semiconductors and manufacturing, including most recently as Executive Vice President and Chief Financial Officer at Micron Technology, Inc. ▪Make-Whole Compensation. As previously disclosed, Mr. Zinsner was granted a make-whole award of $19,000,000 in the form of equity awards and a cash bonus, which represents less than the approximately $22,000,000 he forfeited from his prior employer. Additional details regarding Mr. Zinsner’s make-whole payments are summarized in Appendix B on page B-2. This make-whole award was composed of approximately $12,000,000 in RSUs vesting annually over three years, PSUs with a target value of approximately $5,000,000 (identical to the PSUs granted to our NEOs in 2022), and a cash bonus of $2,000,000. He will forfeit the unvested portion of his make-whole equity awards in the event his employment is terminated for any reason (other than death or disability) within the first three years of employment with us. He must repay the cash bonus on a prorated basis in the event he voluntarily terminates his employment or is terminated by Intel for cause within two years of the payment date. ▪No Inducement Awards. Mr. Zinsner did not receive any inducement awards as part of his new-hire equity awards. ▪Christoph Schell joined Intel as Executive Vice President and Chief Commercial Officer on March 14, 2022 to lead our Sales, Marketing and Communications Group. Mr. Schell has a track record of driving innovative and disruptive go-to-market strategies around the globe, most recently serving as Chief Commercial Officer at HP Inc. He brings expertise in understanding business segments; verticals and solutions; and services customers want. ▪Make-Whole Compensation. Mr. Schell was provided a new-hire, make-whole cash award of $20,000,000, which represents less than the approximately $33,000,000 he forfeited from his prior employer. ▪Mr. Schell joined Intel shortly before he otherwise would have vested in a significant amount of equity awards at his prior employer, and it was necessary to offer an amount that would enable him to make the transition without undue delay or inequity. In recognition that the amount Intel offered represented only a portion of the amount Mr. Schell was forfeiting to join Intel and to provide certainty of liquidity for the awards, he was provided these partial make-whole awards in cash rather than equity. The amount of the new hire cash bonus reflects the value of Mr. Schell’s time-based RSUs that would have vested in 2022 if he had stayed with his prior employer, with a large portion of the RSUs expected to vest by July 2022. Additional details regarding Mr. Schell’s make-whole payments are summarized in Appendix B on page B-2. ▪$5,000,000 was paid to Mr. Schell within 30 days of his start date with the company and the remaining $15,000,000 was paid within 30 days following July 1, 2022. ▪These make-whole payments must be repaid on a prorated basis in the event he voluntarily terminates his employment or is terminated by Intel for cause within two years of the payment date. ▪No Inducement Awards. Mr. Schell did not receive any inducement awards as part of his new-hire awards. ▪Michelle Johnston Holthaus was promoted to Executive Vice President and General Manager, Client Computing Group on March 14, 2022. Ms. Johnston Holthaus is a 25-year Intel veteran who brings a deep understanding of Intel’s customers
Update on CEO New-Hire Equity Awards
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Update on CEO New-Hire Equity Awards
and the client computing business based on her prior leadership role as the head of the Sales, Marketing and Communications Group. ▪April Miller Boise joined Intel as Executive Vice President and Chief Legal Officer on July 6, 2022, to lead the Legal, Trade, and Government Affairs team. Ms. Miller Boise is a skilled executive, attorney, and innovative business leader who brings deep expertise across a number of areas including corporate governance, policy, and global transactions, and more than 25 years of legal experience in global markets and manufacturing, most recently serving as the Chief Legal Officer at Eaton Corporation. Each of these executives receives a standard annual compensation package that is described in more detail in the following sections. In May 2022, George Davis retired from Intel, and he stepped down as Chief Financial Officer effective January 17, 2022. Mr. Davis is a NEO for 2022 due to his service as Executive Vice President and CFO during fiscal year 2022, but he is not a current Intel executive officer.
2022 NEO Pay Overview
| | Pay Element | | Purpose | Performance Period | 2022 Performance Metric | | | | | | | | | | Base Salary | | Designed to be market-competitive and attract and retain talent | Annual | — | | | | Annual Cash Bonus | Incentivize achievement of Intel’s near-term financial and operational objectives, consistent with Intel’s longer-term goals | Annual | New metric mix for 2022: ▪Revenue (25%) ▪Gross Margin Percentage (25%) (with negative decelerator - see page 84) ▪One Intel Operational Goals (25%) ▪Individual Objectives and Key Results (25%)* | | | | Quarterly Cash Bonus | Company-wide program that rewards quarterly profitability based on Intel’s net income relative to company compensation costs | Quarter | ▪5% of Quarterly Net Income divided by Intel’s worldwide cost of a day’s pay ▪CEO removed from program effective 1/1/2022; other NEOs removed effective 1/1/2023 | | | | Performance Stock Units (80% of LTI mix for CEO, 50% for other NEOs) | Designed to reward long-term profitability and long-term performance relative to peers; to create alignment with stockholders; and to facilitate executive retention | Three Years | New metric mix for 2022: ▪Revenue growth percentage (weighted 60%) ▪Cash flow from operations (weighted 40%) ▪Three-year TSR modifier relative to S&P 500 Index (+/- 25 pts) ▪Three-year Revenue CAGR modifier (+/- 25 pts) | | | | Restricted Stock Units (20% of LTI mix for CEO, 50% for other NEOs) | Facilitates stock ownership, executive retention, and stockholder alignment | Over Three Years | ▪Stock Price |
Incentive Program Results
Incentive Program Results As discussed in greater detail below in “2022 Compensation of Our NEOs” on page 80, our 2022 executive compensation programs were structured to provide strong pay-for-performance alignment as evidenced by recent payouts. As shown on the following table, below-threshold performance on revenue and gross margin percentage contributed to below-target short-term incentive payouts. Similarly, none of the PSUs granted in 2020 with a three-year performance period were earned at the end of the performance period in 2022 as a result of below-threshold performance on the two financial metrics, relative TSR and EPS growth percentage.
Incentive Program Results
| Pay Element | 2022 Results | Performance Summary | | 2022 Annual Cash Bonus | 27.52% | CEO: Payout of 27.52% of target reflects (i) performance achieved at 0% for the revenue goal, (ii) performance achieved at -40% for the gross margin percentage with the negative decelerator, and (iii) performance achieved at 122.55% for the One Intel operational goals (see “One Intel Operational Goals” on page 85 for more detail). | | | 45.64% Average | Other NEOs: Average payout of 45.64% of target reflects (i) performance achieved at 0% for the revenue goal, (ii) performance achieved at -40% for the gross margin percentage with the negative decelerator, (iii) performance achieved at 122.55% for the One Intel operational goals (see “One Intel Operational Goals” on page 85 for more detail), and (iv) performance achieved at an average of 100% for individual objectives and key results that place greater emphasis on achieving long-term strategic transformation initiatives rather than achieving annual financial targets (see “Individual Performance Goals” on page 89 for more detail). | | 2022 Quarterly Cash Bonus Total Days | 8.8 | Total payout reflected as days of eligible pay based on the company’s 2022 quarterly profitability (CEO was not eligible to participate starting in 2022). | | Performance Stock Units Granted in 2020 (vest date 1/31/2023) | 0% | Payout at 0% of target. Intel’s three-year TSR payout was 0% (weighted 50%) and Intel’s three-year EPS growth rate percentage payout was 0% (weighted 50%). | | Year 1 of Performance Stock Units Granted in 2022 (vest date 1/31/2025) | 0% | Results for the first year of the three-year performance period resulted in 0% performance for 2022 for the revenue growth percentage and cash flow from operations metrics. |
Incentive Program Results
| 78 | |
2023 NEO COMPENSATION CHANGES
2023 NEO COMPENSATION CHANGES Following extensive stockholder engagement, and a thorough analysis of the needs of our business, the Compensation Committee approved several key changes to our 2023 compensation programs (previously described in the section titled “Stockholder Engagement Shaped Our Response to the 2022 Say-on-Pay Vote” above). These changes were designed to further align compensation to our strategy, strengthen our pay-for-performance linkage, provide further alignment with stockholders’ long-term interests, and meet the cost cutting needs of our company given the continued macro-economic headwinds we face. ▪Quarterly Incentive Cash Program: The Compensation Committee removed the NEOs from participation in Intel’s company-wide quarterly incentive cash program, effective January 1, 2022 for Mr. Gelsinger, and effective January 1, 2023 for all other NEOs. ▪Long-Term Incentive (LTI) Equity Program Design: The Compensation Committee redesigned the LTI equity program to reflect stockholder input, increasing the weighting of PSUs to 60% for our NEOs other than our CEO (who remained at 80% PSUs), incorporating a payout cap at target for PSUs in the event Intel’s absolute TSR is negative, and moving to annual vesting over three years for RSUs. ▪Reductions in Base Salary and Target Bonus: The Compensation Committee, with the support of our senior management team, made the decision to temporarily reduce base salaries for our CEO and NEOs 25% and 15%, respectively, with 2023 target bonuses based on the new blended salaries (certain months at prior salary and certain months at reduced salary). Prior to making the temporary base salary adjustments, we had continued to conduct extensive market benchmarking and had positioned our CEO’s target total direct compensation to approximate the median of our peer group’s CEO compensation. The section titled “2023 NEO Compensation Changes and Pay Overview” on page 94 provides additional detail on our 2023 programs, including a table that lists each of the pay elements.
Intel’s Executive Compensation Best Practices
| What We Do | What We Don’t Do | | We award performance-based compensation that uses a variety of performance measures and performance periods We have a substantial majority of executive pay “at risk,” based on a mix of absolute and relative financial, operational, and stock price performance metrics We have robust stock ownership guidelines for all executive officers We have clawback policies that apply to our Annual Cash Bonus Plan and equity incentive plans and forfeiture provisions that can be triggered by certain detrimental conduct We conduct an annual Say-on-Pay vote and frequent votes on our 2006 Equity Incentive Plan We conduct substantial and regular engagement with our stockholders We impose limits on maximum incentive award payouts We incorporate relevant ESG metrics in our executive compensation program | No change in control compensation arrangements or excise tax gross-ups No perquisite-related tax gross-ups for executive officers (except for company-wide benefits such as reimbursement of relocation and housing costs) No hedging or pledging of Intel common stock by executives or directors No special retirement plans exclusively for executive officers No liberal share recycling under the equity incentive plans No repricing or exchange of underwater stock options without stockholder approval No excessive executive perquisites |
Pay Philosophy and Elements of Compensation
Pay Philosophy and Elements of Compensation The principal elements of our pay-for-performance philosophy include a competitive pay positioning strategy, a heavy emphasis on incentive-driven pay, and goals that are appropriately aligned with our business strategy (in terms of both selection and attainability), as evidenced by the following program components. ▪The competition for executive talent in the technology sector continued to intensify through a multi-year cycle that brought advanced nodes to market, expanded chip use-cases, and new entrants to semiconductor design and manufacturing. In addition to continuing to compete for talent against other successful, established technology companies, we increasingly face an even more competitive landscape as some of our largest customers have begun using their own silicon designs and as a wide range of smaller, high-growth companies focused on emerging technologies continue to develop. The Compensation Committee believes that a competitive, target total direct compensation opportunity is critical to attract, retain, and reward the executive talent crucial to driving value for our stockholders. To that end, total compensation is designed to be competitive with a peer group of companies all vying for the top technical and leadership talent in the world. Adjustments to each individual’s pay position take into account our desire to compensate our executive officers based upon performance, criticality of role, and experience, while fairly balancing internal and external pay equity considerations among executive roles. ▪Total direct compensation opportunities are designed so that a substantial portion of executive pay is variable or “at risk,” based primarily on specific financial metrics or stock price performance over the long term. ▪To further align our executive officers’ interests with those of our stockholders, the Compensation Committee has structured compensation so that the proportion of variable cash and equity-based pay increases with higher levels of responsibility. ▪By using financial, operational, and stock price measures such as revenue, gross margin, cash flows from operations, One Intel goals, and TSR, our incentive plans provide a clear and quantifiable link to operational performance with the goal of creating long-term stockholder value. Our executive compensation elements for 2022 included base salary, an annual cash bonus, long-term incentive equity awards consisting of RSUs and PSUs, and for NEOs other than our CEO, a quarterly cash bonus. Details of each of these pay elements are provided below in “2022 Cash Compensation” on page 82 and “2022 Equity Incentives” on page 92. We also provide a competitive benefits package that includes health care, retirement benefits, financial planning, life insurance, and other programs that are designed to allow our executive officers to maximize time and attention on activities designed to increase stockholder value. We believe that the sum of these components provides highly motivational incentives that link the pay of our executive officers to the performance of our company and enables Intel to attract and retain the very best talent in a highly competitive market.
Use of Independent Compensation Consultant
Use of Independent Compensation Consultant The Compensation Committee engaged Compensia throughout 2022 as its independent executive compensation consultant. During 2022, Compensia’s work with the Compensation Committee included advice, analysis, and recommendations on: ▪total compensation philosophy; ▪program design, including program goals, components, and metrics; ▪compensation trends in the technology sector and in the general marketplace for senior executives; ▪regulatory trends; ▪compensation of our CEO (including changes to the CEO’s new-hire equity awards) and the other executive officers; and ▪stockholder engagement efforts. The consultant reported directly to the Compensation Committee and interacted with management at the committee’s direction. Compensia did not perform work for Intel in 2022 except under its engagement by the Compensation Committee and the Corporate Governance and Nominating Committee (advising on director compensation). The Compensation Committee assessed its consultant under factors set forth in the SEC’s rules and concluded that Compensia was independent, and that the firm’s work in 2022 for the Compensation Committee did not raise any conflicts of interest. Beginning in 2023, the Compensation Committee has appointed a new independent compensation consultant, Semler Brossy.
External Competitive Considerations for 2022
External Competitive Considerations for 2022 To assist the Compensation Committee in its review of executive compensation in early 2022, Compensia, in conjunction with Intel’s Compensation and Benefits Group, provided compensation data compiled from executive compensation surveys, as well as data gathered from annual reports and proxy statements from companies that the Compensation Committee selected as a peer group for executive compensation analysis purposes. The historical compensation data was adjusted to arrive at current-year estimates for the peer group. The Compensation Committee used this data to compare the compensation of our NEOs to that of the individuals holding comparable positions at the companies in the peer group and make informed decisions.
Peer Group
Peer Group The peer group used for benchmarking compensation is focused exclusively on technology companies, as we primarily compete for talent with other technology companies. Our 2022 compensation peer group for the first half of the year consisted of 16 technology companies. The Compensation Committee selected our peers based on size, strategic relevance, business scope and comparability, and R&D investment. The Compensation Committee focused on a pure technology peer group because of their greater relevance, the fact that pay practices at technology companies differ from those of non-technology companies, and because our talent pool movement is primarily within the technology industry. While no one individual company is a perfect match for Intel’s size and business, the peer group on aggregate reflects a snapshot of the market Intel competes with for executive talent. The Compensation Committee added Micron Technologies to our peer group in July 2022 for benchmarking beginning in the fall of 2022 because of Micron’s size, manufacturing capabilities, multi-segmented business operations, and focus on semiconductors. As of the end of 2022, our compensation peer group consisted of 17 technology companies.
Peer Group
| 2023 PROXY STATEMENT | 81 |
Peer Group
The table below shows information for our 2022 technology peer group:
Peer Group
| Company | Reported Fiscal Year | Revenue ($ in billions) | Net Income (Loss) ($ in billions) | | Intel 2022 | 12/31/2022 | 63.0 | 8.0 | | Intel 2022 Percentile | | 62% | 47% | | Technology Peer Group | | | | | Advanced Micro Devices, Inc. (AMD) | 12/31/2022 | 23.6 | 1.3 | | Alphabet Inc. | 12/31/2022 | 283.0 | 60.0 | | Amazon.com Inc. | 12/31/2022 | 514.0 | (2.7) | | Apple Inc. | 9/24/2022 | 394.3 | 99.8 | | Applied Materials, Inc. | 10/30/2022 | 25.8 | 6.5 | | Broadcom, Inc. | 10/30/2022 | 33.2 | 11.5 | | Cisco Systems, Inc. | 7/30/2022 | 51.6 | 11.8 | | Dell Technologies, Inc. | 1/28/2022 | 101.2 | 5.7 | | HP Inc. | 10/31/2022 | 63.0 | 3.2 | | International Business Machines Corporation | 12/31/2022 | 60.5 | 1.6 | | Meta Platforms, Inc. (fka Facebook Inc.) | 12/31/2022 | 116.6 | 23.2 | | Micron Technology, Inc. | 9/1/2022 | 30.8 | 8.7 | | Microsoft Corporation | 6/30/2022 | 198.3 | 72.7 | | NVIDIA Corporation | 1/29/2023 | 27.0 | 4.4 | | Oracle Corporation | 5/31/2022 | 42.4 | 6.7 | | Qualcomm Incorporated | 9/25/2022 | 44.2 | 12.9 | | Texas Instruments Incorporated | 12/31/2022 | 20.0 | 8.7 |
Annual Incentive Cash Compensation
Annual Incentive Cash Compensation In January 2022, the Compensation Committee approved the 2022 performance metrics and the goals under the Intel Corporation Executive Annual Performance Bonus Plan (Annual Cash Bonus Plan). For our CEO, the 2022 Annual Cash Bonus Plan design was as follows:
Annual Incentive Cash Compensation
| Financial: Revenue (Non-GAAP) (1/3) | | Financial: Gross Margin Percentage (Non-GAAP) (1/3) | | One Intel Operational Goals (1/3) | | Annual Cash Bonus Plan Payout |
Annual Incentive Cash Compensation
For our NEOs other than the CEO, the 2022 Annual Cash Bonus Plan design was as follows:
Annual Incentive Cash Compensation
| Financial: Revenue (Non-GAAP) (25%) | | Financial: Gross Margin Percentage (Non-GAAP) (25%) | | One Intel Operational Goals (25%) | | Individual OKRs (25%) | | Annual Cash Bonus Plan Payout |
Annual Incentive Cash Compensation
The table below shows the annual incentive cash compensation target amounts for our NEOs under the Annual Cash Bonus Plan for 2022, which were set at 275% of base salary for our CEO and 165% of base salary for the other NEOs, and compares those targets with 2021, with the exception of Ms. Johnston Holthaus and Messrs. Zinsner and Schell who were not NEOs in 2021. Mr. Davis was not eligible under the Annual Cash Bonus Plan as he retired from Intel in May 2022.
Annual Incentive Cash Compensation
| Name | 2022 Annual Incentive Cash Target Amount ($) | 2021 Annual Incentive Cash Target Amount ($) | % Change 2022 vs. 2021 | | Patrick P. Gelsinger | 3,437,500 | 3,437,500 | —% | | Michelle Johnston Holthaus | 1,361,300 | N/A | N/A | | Sandra L. Rivera | 1,361,300 | 1,195,300 | 14% | | David A. Zinsner | 1,361,300 | N/A | N/A | | Christoph Schell | 1,361,300 | N/A | N/A |
Annual Incentive Cash Compensation
The threshold, target, and maximum goals for the performance metrics under the Annual Cash Bonus Plan were established at the start of 2022. Each of the performance metrics have a possible payout of 0-200% (up to 240% for the One Intel operational metric), and the maximum total payout remains capped at 200% of the executive’s target opportunity.
Annual Incentive Cash Compensation
| 2023 PROXY STATEMENT | 83 |
2022 Annual Cash Bonus Plan Metrics
2022 Annual Cash Bonus Plan Metrics In response to stockholder feedback received after our 2021 Annual Stockholders’ Meeting, we shifted the financial metrics in the Annual Cash Bonus Plan formula for 2022 to measure our revenue and gross margin performance against pre-established annual target goals. We reduced the weighting of the One Intel operational goals and added individual “Objectives and Key Results” (OKRs). A summary of the metrics and how they align to our long-term strategy is presented below.
2022 Annual Cash Bonus Plan Metrics
| Metric | CEO Weight | Other NEO Weight | Why Included in our Annual Cash Bonus Plan | | Revenue | 1/3 | 25% | ▪Aligns to our growth strategy and gives us the ability to measure our progress against our financial plans set early in the year | | Gross Margin Percentage | 1/3 | 25% | ▪Ensures that growth is additive to the bottom line and gives us the ability to measure our progress against our financial plans set early in the year ▪Metric includes a negative decelerator feature that promotes significant rigor (see “Negative Discretion” on page 89) | | One Intel Operational Goals | 1/3 | 25% | ▪Goals represent key deliverables or milestones that position the company to successfully execute our long-term strategic objectives ▪Includes six operational goal categories that apply across all business groups to promote a “One Intel” mindset ▪The six categories include: product leadership, scale growth engines, process efficiency and leadership, culture, inclusive business practices, and sustainability leadership. These goals are highly specific and extremely strategic. They cascade throughout our organization and are a core aspect of how we manage the company | | Individual OKRs | — | 25% | ▪Provides ability to further promote strong execution of our strategy and drive differentiation in the plan results based on our NEOs’ individual contributions to Intel during the performance period ▪Each executive’s performance is assessed against the individual’s 2022 pre-established objectives ▪Our CEO does not have an individual performance element to his Annual Cash Bonus Plan as he is ultimately accountable for the financial and operational performance of the company |
2022 Annual Cash Bonus Plan Metrics
Each of the Annual Cash Bonus Plan metrics are measured and scored independently and then added together to determine the final Annual Cash Bonus Plan payout, subject to a 200% maximum payout.
Financial Metrics and Goals
Financial Metrics and Goals The pay curves for the 2022 financial metrics have threshold, target, and maximum goals. Performance below the threshold results in zero payout for that metric. Payout between intermediate outcomes is determined by linear interpolation. The following table shows the 2022 goals for revenue and gross margin set by the Compensation Committee for the NEOs, the actual results, and the payout for each financial metric.
Financial Metrics and Goals
| Metric | Threshold | Target | Maximum | Actual | | Revenue (Non-GAAP)1 | $68.4 billion | $76 billion | $80 billion | $63.1 billion | | Payout | —% | 100% | 200% | —% |
Financial Metrics and Goals
| | Threshold | Aggressive Deceleration | Target | Maximum | Actual | | Gross Margin Percentage (Non-GAAP)1 | 48% | 49.5% | 52% | 54% | 47.3% | | Payout | -40% | -10% | 100% | 200% | -40% |
Competitive Concerns
| Negative Discretion | Evaluating One Intel Goals During a Challenging Year for Our Financial Results | | The Compensation Committee has confidence in the rigor and discipline of the scoring process for our One Intel operational goals and takes into consideration other relevant factors. The final performance of the One Intel operational goals resulted in a total score of 138.80% and a payout above target. While 2022 was a challenging financial year for the company, the One Intel operational goals were focused on longer term operations that facilitate the long-term strategy and by design, are not directly tied to the immediate financial results. The Compensation Committee believes the goals were appropriately calibrated and leading the company in the right direction towards the long-term path. That said, the Compensation Committee considered the NEOs’ bonus payouts in the context of overall company performance and determined it was appropriate to reduce our NEOs’ One Intel operational goals payout from 138.80% to 122.55%. | The Compensation Committee assessed the company’s performance against the One Intel operational goals in the context of our overall performance, including performance against our revenue and gross margin goals. While our revenue and gross margin goals are intended to assess performance in a given year, the One-Intel operational goals serve a different purpose—to assess our performance against key deliverables or milestones that position the company to successfully execute our long-term strategic objectives, and to drive revenue, gross margin, and stockholder value creation in future years. While 2022 was a challenging financial year for the company, the Compensation Committee does not believe it is inconsistent to have performed below threshold against our financial goals but above target against our goals that tie to the longer term, and has confidence in the rigor and disciplined One Intel goal scoring process. Nevertheless, the Compensation Committee determined it was appropriate to reduce our NEOs’ One Intel operational goal payout. |
Individual Performance Goals
Individual Performance Goals Individual performance goals (other than for our CEO) or OKRs were included in the Annual Cash Bonus Plan for the first time in 2022 to further promote strong execution of our strategy and drive differentiation in the payout results based on our NEOs’ individual contributions to Intel during the performance period. The Compensation Committee approved the OKRs for each NEO, which included objectives critical to our strategy and transformation, at the beginning of 2022. The CEO’s Annual Cash Bonus Plan did not include the individual performance metric, as he was responsible for all the key objectives for 2022 as Intel’s CEO. This approach of establishing individual OKRs is part of the company’s broader effort to return to a culture with clear and explicit performance management through OKRs that are separate from the immediate financial results, and this was a core aspect of the strategy around how to manage the company when we underwent a CEO transition. Our CEO assessed each of the other NEO’s performance against the individual’s 2022 pre-established OKRs, and then his assessments and recommendations of the performance score for each NEO were presented to the Compensation Committee. The Compensation Committee concurred with the CEO’s assessments and recommendations for the individual scores. Below are the key objectives and performance highlights for each NEO as well as their final individual scores, and within each of the objectives, there were another three to five specific and measurable objectives. As described above in the One Intel operational goals section, we have strived to provide stockholders with greater visibility into the performance goals where practical, while balancing the competitive concerns noted above.
Individual Performance Goals
| 2023 PROXY STATEMENT | 89 |
Individual Performance Goals
The following table summarizes each NEO’s objectives, performance achievements, and the individual score:
Individual Performance Goals
| Name | Individual Objectives | Individual Performance Highlights | Individual Score | | Michelle Johnston Holthaus | ▪Achieve CCG 2022 annual revenue target ▪Attract and develop top technical and diverse talent ▪Deliver annual cadence of leadership products to redefine our position in the industry | ▪Raptor Lake desktop launch and encouraging Meteor Lake power-on milestone ▪Winning market share against fierce competition ▪Strong progress on strategic initiatives and shoring up the P&L in the midst of extremely challenging macroeconomic conditions ▪Stabilizing the organizational impact resulting from reorganizations, expansion of cross-functional development and design initiatives | 100% | | Sandra L. Rivera | ▪Define and deliver the Xeon platform and non-CPU solutions ▪Acquire and retain world-class technical and diverse talent ▪Execute the data center of the future ▪Achieve DCAI 2022 annual revenue target | ▪Delivering on commitment to commercially launch Sapphire Rapids with Tier 1 Customers ▪Successful pivot of Intel® Optane™ product line and launch of Gaudi 2 ▪Sustained momentum on Programmable Solutions Group development with highlights at Field Programmable Gate Array Technology Day | 95% | | David Zinsner | ▪Meet 2022 financial objectives ▪Improve operating execution to deliver IDM 2.0 ▪Modernize financial and operating systems and processes ▪Foster a winning culture and talent base for the finance organization | ▪Firmly establishing leadership in the CFO role guiding the company through fiscal 2022 year and leading our 2023 financial goal setting processes ▪Leading first-of-its-kind Semiconductor Co-Investment Program (SCIP) and reaching agreement with Brookfield Asset Management leading to joint investment up to $30 billion ▪Completing Initial Public Offering of Mobileye ▪Leading austerity measures and actions to deliver commitment to reduce spending by $3 billion in 2023 and $8-$10 billion through 2025 | 110% | | Christoph Schell | ▪Stabilize sales organization and set go-to-market strategy ▪Meet CCG and DCAI MSS goals for 2022 ▪Deepen customer engagement | ▪Strong leadership with customer and internal business groups during extraordinarily challenging macro-economic environment ▪Development of transformational strategy of Intel’s sales and marketing organization reshaping outcomes-based selling | 95% |
Individual Performance Goals
| 90 | |
Final 2022 Annual Cash Bonus Plan Payout
Final 2022 Annual Cash Bonus Plan Payout The following table summarizes the performance results for each NEO under the Annual Cash Bonus Plan for 2022. Mr. Davis is not included in the tables below as he retired from Intel in May 2022 and was not eligible to participate in the Annual Cash Bonus Plan.
Final 2022 Annual Cash Bonus Plan Payout
| Name | Revenue (weighted 25%) | Gross Margin Percentage (weighted 25%) | One Intel Goals BEFORE Adjustment | One Intel Goals (weighted 25%) | Individual Performance Factor (weighted 25%) | | Patrick P. Gelsinger | 0 | -40% | 138.80% | 122.55% | N/A | | Michelle Johnston Holthaus | 0 | -40% | 138.80% | 122.55% | 100% | | Sandra L. Rivera | 0 | -40% | 138.80% | 122.55% | 95% | | David Zinsner | 0 | -40% | 138.80% | 122.55% | 110% | | Christoph Schell | 0 | -40% | 138.80% | 122.55% | 95% |
Final 2022 Annual Cash Bonus Plan Payout
The following table sets forth the 2022 annual cash bonus target for each NEO as well as their cash payments for 2022 and 2021, reflecting the year-over-year changes, with the exception of Ms. Johnston Holthaus and Messrs. Zinsner and Schell who were not NEOs in 2021.
Final 2022 Annual Cash Bonus Plan Payout
| Name | 2022 Annual Cash Bonus Target ($) | Final Payout % | 2022 Annual Cash Bonus Payment ($) | 2021 Annual Cash Bonus Payment ($) | | % Change 2022 vs. 2021 | | Patrick P. Gelsinger | 3,437,500 | 27.52% | 945,900 | | 4,904,300 | (81)% | | Michelle Johnston Holthaus | 1,361,300 | 45.64% | 621,300 | | N/A | N/A | | Sandra L. Rivera | 1,361,300 | 44.39% | 604,300 | | 1,705,400 | (65)% | | David A. Zinsner | 1,361,300 | 48.14% | 600,700 | | N/A | N/A | | Christoph Schell | 1,361,300 | 44.39% | 503,500 | | N/A | N/A |
Quarterly Incentive Cash Compensation
| | | | | | | 5% of Quarterly Net Income | | Cost of a Day’s Pay | | Quarterly Bonus Payout |
2022 Equity Incentives
2022 Equity Incentives The Compensation Committee’s decisions related to annual long-term incentive (LTI) equity awards are largely based on an executive’s potential and sustained performance, as well as succession planning, business need and criticality, internal parity, consideration of a competitive market analysis, and our CEO’s recommendations (for executives that report to him and other officers). The table below shows the annual target LTI equity award values approved by the Compensation Committee for our NEOs in 2022, based on its annual review of these factors, as compared with annual equity award values approved for the NEOs in 2021, with the exception of Ms. Johnston Holthaus and Messrs. Zinsner and Schell who were not NEOs in 2021 and Mr. Gelsinger who received one-time, new-hire equity awards in connection with his appointment as CEO and did not receive an additional annual LTI equity award for 2021. Mr. Davis retired from Intel in May 2022 and did not have a 2022 approved target LTI equity award value. In 2022, the annual LTI equity awards granted to the CEO were composed of approximately 80% PSUs and 20% RSUs and to the other NEOs were generally composed of approximately 50% PSUs and 50% RSUs.
2022 Equity Incentives
| Name | 2022 Approved Value of Annual LTI Equity Awards ($)1 | 2021 Approved Value of Annual LTI Equity Awards ($) | % Change 2022 vs. 2021 | | Patrick P. Gelsinger | 21,500,000 | — | N/A | | Michelle Johnston Holthaus | 10,300,000 | N/A | N/A | | Sandra L. Rivera 2 | 10,300,000 | 6,000,000 | 72% | | David A. Zinsner | 8,250,000 | N/A | N/A | | Christoph Schell | 9,300,000 | N/A | N/A |
2022 Equity Incentives
1The amounts reported in the “Summary Compensation Table” and the “Grants of Plan-Based Awards in Fiscal Year 2022 Table” on pages 99 and page 103, respectively, differ from these values due primarily to (i) SEC and accounting standard rules that require that a grant will occur only if the goals are established and since the 2022 PSUs have goals with annually set objectives, only 1/3 of the 2022 PSUs will be deemed granted in 2022 for purposes of the Summary Compensation Table, (ii) changes in the fair value of the awards between the date the Compensation Committee approved awards and the date they were actually granted, and (iii) the conversion method we apply when granting awards compared to that used for valuing them under applicable accounting standards and SEC rules (utilizing a 30-day trailing average stock price rather than a closing stock price on the grant date). In addition, the fair value of an RSU award for financial reporting purposes is discounted for the present value of dividends that are not paid on RSUs prior to vesting. NEOs do not get the benefit of this discount when their awards are converted into shares at grant. 2Ms. Rivera’s increased 2022 LTI value reflects her increased responsibilities and promotion to General Manager of the Data Center and AI group in July 2021.
2022 Annual PSU Awards
2022 Annual PSU Awards PSUs are performance-based RSUs or Performance Stock Units under which the number of shares of Intel common stock earned is based on our achievement measured against specified performance metrics over a three-year period. For 2022, our PSU awards may be earned based on achievement of two performance metrics, which have goals with annually set objectives: revenue growth percentage (weighted 60%) and cash flow from operations (CFFO)(weighted 40%), and two three-year modifiers that can each impact the financial score percentages by +/- 25 points: three-year relative TSR (target payout to require above-median performance relative to the S&P 500 Index) and three-year revenue CAGR. The two modifiers ensure an alignment with the capital allocation strategy and focus on growth, in addition to providing long-term three-year goals. The payout opportunity for the executives is 0% to 200% of the target number of PSUs granted.
2022 Annual PSU Awards
| 92 | |
2022 Annual PSU Awards
| Weight | 2022 | 2023 | 2024 | Final Score | | Modifier 1 | | Modifier 2 | | | | 60% | Revenue Growth % | Revenue Growth % | Revenue Growth % | Average of the Annual Scores | | TSR | | Revenue CAGR | | Final Score (capped at 200%) | | 40% | CFFO | CFFO | CFFO | | | +/- 25 points | | +/- 25 points | | | | | Annual Score (0-200) | Annual Score (0-200) | Annual Score (0-200) | | | 3-year TSR relative to S&P 500 Index | | 3-year Revenue CAGR | | |
2022 Annual PSU Awards
The goals for revenue growth percentage and CFFO metrics will be set annually by the Compensation Committee and the three annual results will then be averaged at the end of the three-year performance period. The Compensation Committee changed from setting three-year goals to setting annual objectives for the two financial metrics because it determined annual objectives were necessary at this time given the goal of accelerating Intel’s ongoing transformation while maintaining the ability to adapt to challenges in our industry; however, in response to feedback from stockholders, the Compensation Committee has committed to return to multi-year goal setting by fiscal year 2025. Under the SEC and accounting standard rules for the executive compensation tables, the grant date for PSUs is established when the goals for a period are set by the Compensation Committee. Therefore, the executive compensation tables in this proxy statement will reflect only 1/3 of the grant date fair value of the 2022 PSUs, and the executive compensation tables in future years will reflect additional years of “grants” for the 2022 PSUs as the goals are set for years 2023 and 2024 by the Compensation Committee under the terms of the awards. The financial goals for 2022 set by the Compensation Committee for revenue growth and CFFO were as follows:
2022 Annual PSU Awards
| Performance Period | Metric | Threshold | Target | Maximum | Actual | Payout Per Metric | | 2022 | Revenue Growth %1 (Non-GAAP) | -8.5% | 1.7% | 7.1% | -15.0% | 0% | | | CFFO1 (Non-GAAP) | $24B | $27B | $30B | $13.5B | 0% | | 2022 Payout % | | | | | | 0% |
2022 Annual PSU Awards
1.Refer to the reconciliation of these non-GAAP financial measures to the comparable GAAP financial measure in Appendix A beginning on page A-1 of this proxy statement. Our revenue growth percentage for 2022 was -15.0%, which is below the 2022 threshold goal, resulting in achievement of 0% of target for the revenue growth percentage metric. Our CFFO for 2022 was $13.5B, which is below the 2022 threshold goal, resulting in achievement of 0% of target for the CFFO metric. Accordingly, the 2022 PSUs achieved an annual score of 0% for fiscal year 2022.
Payout of 2020 PSU Awards
Payout of 2020 PSU Awards 2020 PSU Award. The PSUs granted in January 2020 with a January 2020 through December 2022 performance period were earned at 0% of the target number of shares granted based on a relative TSR metric (weighted 50%) and cumulative EPS growth percentage metric (weighted 50%). Only Mses. Johnston Holthaus and Rivera had outstanding 2020 PSU awards, for which they received no payout. With respect to the TSR performance metric, our three-year TSR was -49.23%, which was 91.20 percentage points below the median TSR of the S&P 500 Index peer group over the performance period. As a result, the relative TSR metric achieved 0% of target. With respect to the cumulative EPS growth percentage metric, the target goal was 6.1%. In order to achieve a maximum payout of 200%, the cumulative EPS growth percentage needed to be 10.4% and in order to achieve any payout, the cumulative EPS growth percentage could not have been lower than -1.8%. For the January 2020 through December 2022 performance period, the cumulative EPS growth percentage was -19.75%, which was below the threshold goal. As a result, the cumulative EPS growth percentage metric achieved 0% of target.
Payout of 2020 PSU Awards
| 2023 PROXY STATEMENT | 93 |
Payout of 2020 PSU Awards
Our PSUs are designed with the intention of challenging executives to reach rigorous long-term goals, and to link the performance of the company with our executives’ compensation. As performance did not reach the threshold levels for the 2020 PSU awards, our 2020 PSUs did not pay out.
Payout of 2020 PSU Awards
| Metric | Threshold | Target | Maximum | Actual | Payout Per Metric | | TSR Performance (vs. S&P 500 IT Index) | (25%) below Index | Equal to Index | 25% | -49.23 ppts below Index | 0% | | EPS Growth % | -1.8% | 6.1% | 10.4% | -19.75% | 0% | | 2020 PSU Aggregate Payout Percentage: | | | | | 0% |
Outstanding PSU Awards Cycles
Outstanding PSU Awards Cycles There are three PSU awards cycles currently outstanding:
Outstanding PSU Awards Cycles
| Grant Year | Performance Period | Performance Metric | Vesting Date | | 2021 | Fiscal Year 2021 - Fiscal Year 2023 | Relative TSR and Cumulative EPS Growth % | January 31, 2024 | | 2022 | Fiscal Year 2022 - Fiscal Year 2024 | Revenue Growth, Cash Flow From Operations, and two modifiers: Relative TSR and Revenue CAGR | January 31, 2025 |
2022 Annual RSU Awards
2022 Annual RSU Awards For 2022, RSUs made up 20% of the annual long-term incentive award opportunities for our CEO, and 50% of the annual long-term incentive award opportunities for our other NEOs. These awards are intended to support our efforts to provide competitive compensation packages to retain executive officers and to reward them for absolute long-term stock price appreciation. RSUs also serve to balance the performance-based nature of PSUs, facilitate stock ownership, and provide a significant incentive to stay with the company. RSUs vest in substantially equal quarterly increments over three years from the grant date. The RSUs granted in 2022 used quarterly vesting of RSUs to help offset the risks inherent in the all-or-nothing 37-month cliff vesting of the PSUs. However, in response to feedback from our stockholders in 2022, the Compensation Committee has committed to change the vesting schedule of RSUs to vest in substantially equal annual increments over three years from the grant date, beginning with the 2023 RSU awards.
2023 NEO Compensation Changes and Pay Overview
2023 NEO Compensation Changes and Pay Overview Following extensive stockholder engagement, and a thorough analysis of the needs of our business, the Compensation Committee approved several key changes to our 2023 compensation programs (previously described in the section titled “Stockholder Engagement Shaped Our Response to the 2022 Say-on-Pay Vote”). These changes were designed to further align compensation to our strategy, strengthen our pay-for-performance linkage, provide further alignment with stockholders’ long-term interests, and meet the cost cutting needs of our company given the continued macroeconomic headwinds we face. ▪Quarterly Incentive Cash Program: The Compensation Committee removed the NEOs from participation in Intel’s company-wide quarterly incentive cash program, effective January 1, 2022 for Mr. Gelsinger, and effective January 1, 2023 for all other NEOs. ▪Long-Term Incentive (LTI) Equity Program Design: The Compensation Committee redesigned the LTI equity program to reflect stockholder input. Below is a summary of the changes to the LTI equity program effective 2023: ▪PSU weighting for our NEOs other than our CEO will be increased to 60% (from 50%) and RSU weighting will be decreased to 40% (from 50%), to ensure that the majority of the LTI equity program is performance based; our CEO remains 80% PSUs and 20% RSUs. ▪PSUs granted in 2023 will have a cap at target in the event Intel’s absolute TSR is negative. ▪RSUs will vest in three equal annual installments on the first three anniversaries of the date of grant, instead of in 12 equal quarterly installments. ▪Reductions in Base Salary and Target Bonus: The Compensation Committee, with the support of our senior management team, made the decision to temporarily reduce base salaries for our CEO and NEOs 25% and 15%,
2023 NEO Compensation Changes and Pay Overview
respectively, with 2023 target bonuses based on the new blended salaries (certain months at prior salary and certain months at reduced salary). Prior to making the base salary adjustments, we had continued to conduct extensive market benchmarking and had positioned our CEO’s target total direct compensation to approximate the median of our peer group’s CEO compensation. The following table lists the pay elements of our 2023 programs and the purpose each serve:
2023 NEO Compensation Changes and Pay Overview
| | Pay Element | Purpose | Performance Period | 2023 Performance Metric | | | | | | | | | Base Salary | Designed to be market-competitive and attract and retain talent Reductions in 2023 base salaries for NEOs, alongside reductions for other employees, reflect the need to cut costs in the current operating environment | Annual | — | | | | | | | | | Annual Cash Bonus | Incentivize achievement of Intel’s near-term financial and operational objectives, consistent with Intel’s longer-term goals Reductions in 2023 base salaries for NEOs will affect target opportunity, which will be based on new blended salaries | Annual | For CEO, four equally weighted (25%) performance metrics: ▪Revenue ▪Gross Margin Percentage ▪Spending Reduction Goal ▪One Intel Operational Goals For other NEOs, five equally weighted (20%) performance metrics: ▪Revenue ▪Gross Margin Percentage ▪Spending Reduction Goal ▪One Intel Operational Goals ▪Individual Objectives and Key Results | | | Performance Stock Units (80% of LTI mix for CEO, 60% for other NEOs) | Designed to reward long-term profitability and long-term performance relative to peers; to create alignment with stockholders; and to facilitate executive retention | Three Years | Annual Goals ▪ Revenue growth percentage (weighted 60%) ▪Cash flow from operations (weighted 40%) Three-Year Goals ▪Three-year TSR modifier relative to S&P 500 Index (+/- 25 pts) ▪Three-year Revenue CAGR modifier (+/- 25 pts) Overall payout capped at target if absolute TSR is negative | | | Restricted Stock Units (20% of LTI mix for CEO, 40% for other NEOs) | Facilitates stock ownership, executive retention, and stockholder alignment | Three Years (with Annual Vesting) | ▪Stock Price Appreciation |
Generally Available
Generally Available The limited post-employment compensation arrangements made generally available to our executive officers, including the NEOs, consist of: ▪a 401(k) savings plan; ▪a discontinued discretionary company-funded retirement contribution plan, and a company-funded pension plan, each of which is intended to be tax-qualified; ▪a non-tax-qualified supplemental deferred compensation plan for certain highly compensated employees; ▪retirement, death, and disability acceleration provisions for equity awards; and ▪retirement and death provisions under the Annual Cash Bonus Plan. Retirement Benefits. The Compensation Committee allows the NEOs to participate in post-employment compensation plans to encourage them to save for retirement and to assist the company in retaining the NEOs. The terms governing the retirement or deferred compensation benefits under these plans for the NEOs are the same as those available to other eligible employees in the US. Intel makes matching contributions up to 5% based on the amount of employee contributions under the 401(k) savings plan (reduced to 2.5% effective March 1, 2023 as part of the reductions to pay as described above in the Executive Summary). To the extent that the amount of the matching contribution is limited by the Internal Revenue Code of 1986, as amended, Intel credits the additional match amount to the non-tax-qualified supplemental deferred compensation plan. Since January 1, 2015, plan assets contributed for US participants and employer contributions have been participant-directed. Starting January 1, 2011, the company-funded pension plan was closed to new hires. Effective January 1, 2015, future benefit accruals were frozen for all employees at or above a specific grade level, including all NEOs, and frozen for all employees effective January 1, 2020. Equity Awards. Our equity awards generally have the following post-employment provisions: ▪Unvested PSUs are canceled upon termination of employment for any reason other than retirement, death, or disability. In the event the holder meets the definition of “retirement” under the Rule of 75 (when the holder’s age plus years of service equal at least 75) or the Rule of Age 60 (reaching age of 60 for grandfathered employees), the number of PSUs eligible for accelerated vesting will be prorated by the number of months employed during the 36-month performance period if the retirement (voluntary or involuntary) occurs within the first calendar year of the grant date; if retirement occurs after the first calendar year of the grant date, then the PSUs are fully vested. In the event of retirement under the Rule of 75 or reaching age of 60 with five years of service for new employees as of 2019 or employees who did not receive performance-based RSUs in 2018 (i.e., non-grandfathered), the number of PSUs eligible for accelerated vesting will be prorated by the number of months employed during the 36-month performance period. PSUs are not settled into shares of our common stock until after the end of the performance period based on actual performance results, even if the holder qualifies for early vesting. ▪RSUs are subject to retirement vesting under the rule of Age 60 or the Rule of 75, but not both. Upon retirement under the Rule of Age 60, the holder receives one additional year of vesting for every five years of service. Upon retirement under the Rule of 75, the holder receives one additional year of vesting. Additional years of vesting means that any RSUs scheduled to vest within the number of years from the retirement date determined under the rule of Age 60 or Rule of 75 will be vested on the holder’s retirement date. ▪Upon disability or death, all unvested RSUs become 100% vested, and unvested PSUs will become vested subject to actual performance.
Generally Available
| 96 | |
Generally Available
Annual Cash Bonus Plan. The Annual Cash Bonus Plan has the following post-employment provisions, unless the Compensation Committee determines otherwise: ▪In the event a participant retires in accordance with the company’s US retirement eligibility rules, the participant will be eligible for a prorated portion of the annual cash bonus, based on the number of months of employment during the year and payable at the times other participants under the plan receive payout of their annual cash bonus. ▪In the event of a participant’s death, the participant’s estate will be eligible to receive the annual cash bonus the participant would have otherwise received if the participant had remained employed for the full performance period, payable at the times other participants under the plan receive payout of their annual cash bonus.
Intel Policies Regarding Hedging, Derivatives, “Short Sales”, or Pledging
Intel Policies Regarding Hedging, Derivatives, “Short Sales”, or Pledging Intel prohibits directors, NEOs, executives, and all other employees from engaging in short sales or other short-position transactions in Intel stock, transactions in publicly traded options and other derivatives based on the value of Intel common stock, or any hedging and monetization transactions that serve to insulate or mitigate against a potential change in Intel’s stock price, including through the use of financial instruments such as prepaid forwards, equity swaps, collars, and exchange funds. This policy does not restrict ownership of, or transactions related to, company-granted awards, such as PSUs, RSUs, employee stock options, and other securities issued by Intel. Holding Intel stock in a margin account and pledging Intel stock as collateral for a loan is prohibited for directors, executive officers, and other senior executives.
Intel Policies Regarding Clawbacks
Intel Policies Regarding Clawbacks Both Intel’s Annual Cash Bonus Plan and equity plans, under which annual incentive cash payments and equity awards, respectively, are made include provisions for seeking the return (clawback) from executive officers of incentive cash payments and stock sale proceeds in the event that those amounts had been inflated due to financial results that later had to be restated. In addition, the equity plans provide that, before seeking recovery, the Compensation Committee must first determine that the applicable executive officer engaged in conduct contributing to the reason for the restatement.
Summary Compensation Table
Summary Compensation Table
Summary Compensation Table
| Name and Principal Position | | Year | Salary ($) 1 | Bonus ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Change in Pension Value and Non-Qualified Deferred Compensation Earnings ($) 2 | All Other Compensation ($) | Total ($) | | Patrick P. Gelsinger | 3 | 2022 | 1,302,100 | — | 8,869,600 | — | 945,900 | — | 497,100 | 11,614,700 | | CEO | | 2021 | 1,098,500 | 1,750,000 | 140,433,000 | 29,108,400 | 5,113,900 | 685,000 | 401,600 | 178,590,400 | | Michelle Johnston Holthaus | 4 | 2022 | 856,300 | — | 5,997,400 | — | 666,000 | — | 114,200 | 7,633,900 | | EVP and GM, CCG | | | | | | | | | | | | Sandra L. Rivera | 4 | 2022 | 856,300 | — | 5,997,400 | — | 649,000 | — | 157,400 | 7,660,100 | | EVP and GM, DCAI | | 2021 | 724,400 | 1,000,000 | 6,130,200 | — | 1,813,300 | — | 130,200 | 9,798,100 | | David A. Zinsner | 5 | 2022 | 790,600 | 2,000,000 | 16,560,600 | — | 634,700 | — | 340,700 | 20,326,600 | | EVP and CFO | | | | | | | | | | | | Christoph Schell | 6 | 2022 | 659,400 | 20,000,000 | 6,478,000 | — | 518,300 | — | 23,100 | 27,678,800 | | EVP and CCO, SMG | | | | | | | | | | | | George S. Davis | 7 | 2022 | 366,100 | — | 244,500 | — | 45,100 | — | 106,800 | 762,500 | | Former EVP and CFO | | 2021 | 925,000 | 1,000,000 | 6,641,200 | — | 2,315,400 | — | 43,400 | 10,925,000 | | | | 2020 | 900,000 | 1,000,000 | 7,088,100 | — | 1,632,500 | — | 157,400 | 10,778,000 |
Summary Compensation Table
1Intel has a 52- or 53-week fiscal year that ends on the last Saturday in December. Fiscal year 2022 was a 53-week fiscal year, which resulted in an extra pay cycle for our NEOs as compared to the prior years 2021 and 2020. 2In 2022, the change in pension value and non-qualified deferred compensation for Mr. Gelsinger was tied to the benefits that were earned when he was a former Intel employee prior to 2011. In 2022, the following NEOs had a loss in pension value of the following amounts: Mr. Gelsinger $(448,000) and Ms. Rivera $(33,000). Ms. Johnston Holthaus' pension value did not change. 3Mr. Gelsinger joined Intel as CEO on February 15, 2021. 4Mses. Johnston Holthaus and Rivera were not NEOs prior to 2022 and 2021, respectively. 5Mr. Zinsner joined Intel as CFO on January 17, 2022. 6Mr. Schell joined Intel as EVP on March 14, 2022. 7Mr. Davis retired from Intel on May 6, 2022, after stepping down as CFO effective as of January 17, 2022 and serving as an advisor until his retirement. He received an RSU award that vested on April 30, 2022. Bonus. Messrs. Zinsner and Schell each received their sign-on cash bonus in accordance with their offer letter. Equity Awards. Under SEC rules, the values reported in the “Stock Awards” column of the Summary Compensation Table reflect the aggregate grant date fair value, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718), of grants of stock awards to each of the NEOs. The grant date fair values of the TSR component of the Performance Stock Units (PSUs), strategic growth PSUs granted in 2019, performance-based stock options granted in 2019, and CEO new-hire awards (including the PSUs with a TSR component, strategic growth PSUs, outperformance PSUs, and performance-based stock options) are determined using the Monte Carlo simulation valuation method. We calculate the grant date fair value of an RSU by taking the average of the high and low trading prices of Intel common stock on the grant date and reducing it by the present value of dividends expected to be paid on Intel common stock before the RSU vests, because we do not pay or accrue dividends or dividend-equivalent amounts on unvested RSUs. The grant date fair value of the EPS growth component of the PSUs are determined using the same methodology as for RSUs and applied to the respective target number of PSUs granted.
Summary Compensation Table
| 2023 PROXY STATEMENT | 99 |
Summary Compensation Table
The following table includes the assumptions used to calculate the aggregate grant date fair value of awards reported for each of 2020, 2021, and 2022, on a grant-date by grant-date basis.
Summary Compensation Table
| | Assumptions | | | | | | | Grant Date | Award Type1 | Volatility2 | Expected Life (Years)3 | | Risk-Free Interest Rate | Dividend Yield | | 1/30/2020 | PSU-EPS | N/A | 3.0 | | 1.4% | 2.0% | | 1/30/2020 | PSU-TSR | 27.8% | 3.0 | | 1.4% | 2.0% | | 1/30/2020 | RSU | N/A | 3.0 | | 1.5% | 2.0% | | 1/30/2021 | PSU-EPS | N/A | 3.0 | | 0.2% | 2.5% | | 1/30/2021 | PSU-TSR | 40.5% | 3.0 | | 0.2% | 2.5% | | 1/30/2021 | RSU | N/A | 3.0 | | 0.1% | 2.5% | | 2/15/2021 | TSR PSU | 40.3% | 3.0 | | 0.2% | 2.3% | | 2/15/2021 | RSU | N/A | 3.0 | | 0.1% | 2.3% | | 2/15/2021 | Perf SO | 29.3% | N/A | | 1.2% | 2.3% | | 2/15/2021 | OUT PSU | 33.8% | 5.0 | | 0.5% | 2.3% | | 2/15/2021 | SG PSU | 33.8% | 5.0 | | 0.5% | 2.3% | | 3/22/2021 | Invest RSU | N/A | 3.0 | | 0.1% | 2.1% | | 11/30/2021 | RSU | N/A | 3.0 | | 0.4% | 2.8% | | 1/31/2022 | RSU | N/A | 3.0 | | 0.9% | 3.0% | | 1/31/2022 | RSU | N/A | 0.2 | 4 | —% | 3.0% | | 1/31/2022 | 2022 PSU | 39.8% | 3.0 | | 1.4% | 3.0% | | 3/30/2022 | RSU | N/A | 3.0 | | 1.7% | 2.8% | | 3/30/2022 | 2022 PSU | 40.6% | 3.0 | | 2.4% | 2.8% |
Summary Compensation Table
1The Award types are as follows:
Summary Compensation Table
| 2022 PSU | PSUs granted in 2022 | Perf SO | Performance-based stock options granted to our CEO | RSU | Restricted Stock Units | | Invest RSU | Matching RSUs granted to our CEO | PSU-EPS | Annually granted PSUs with an EPS performance condition | SG PSU | Strategic growth PSUs granted to our CEO | | OUT PSU | Outperformance PSUs granted to our CEO | PSU - TSR | Annually granted PSUs with a relative TSR performance condition | TSR PSU | PSUs with a relative TSR performance condition granted to our CEO |
Summary Compensation Table
2The Monte Carlo simulation valuation for the PSU – TSR awards and TSR PSU awards assumed a stock price volatility for the S&P 500 IT Index and a correlation coefficient between Intel and the S&P 500 IT Index over the Volatility Period and for the PSU awards granted in 2022 (2022 PSUs) assumed a stock price volatility for the S&P 500 Index and a correlation coefficient between Intel and the S&P 500 Index over the Volatility period, as follows:
Summary Compensation Table
| Grant Date | Volatility Period | Volatility | Correlation Coefficient | | 1/30/2020 | 2.9 | 18.8% | 0.6762 | | 1/30/2021 | 2.9 | 29.3% | 0.7325 | | 2/15/2021 | 3.0 | 29.1% | 0.7332 | | 1/31/2022 | 2.9 | 22.9% | 0.6808 | | 3/30/2022 | 2.8 | 23.8% | 0.6930 |
Summary Compensation Table
3For PSUs and RSUs, this reflects the three-year vesting period from the grant date. For Perf SO, no single assumption is used and the expected life calculated in Monte Carlo simulations is assumed based on the midpoint between the later of the vesting period or the time until the stock hurdle is achieved under each simulation, and the 10 year term of the option. 4Reflects an RSU grant to Mr. Davis that vested on April 30, 2022.
Summary Compensation Table
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Summary Compensation Table
Because the performance-related component of the 2022 PSUs is based on separate measurements of our performance for each year in the three-year performance period, FASB ASC Topic 718 requires the grant date value to be calculated with respect to one-third of the total 2022 PSUs in each year of the three-year performance period, with the value for each year based on the probable outcomes of the revenue growth percentage and cash flow from operations performance conditions against the goals set for that year. The table below sets forth the grant date fair value for one-third of the total 2022 PSUs, determined in accordance with FASB ASC Topic 718 principles (i) based on the probable outcome at target of the performance-related component as of the grant date, (ii) based upon achieving the maximum level of performance under the performance-related component in 2022, and (iii) based on the grant date fair value.
Summary Compensation Table
| Name | | Award Type | Target Outcome of Performance-Related Component Grant Date Fair Value ($)1 | Maximum Outcome of Performance-Related Component Grant Date Fair Value ($)1 | Target Outcome of Performance-Related Component Grant Date Number of Shares (#) | Maximum Outcome of Performance-Related Component Grant Date Number of Shares (#) | | Patrick P. Gelsinger | | Annual Award PSU | 5,149,400 | 10,298,900 | 108,455 | 216,910 | | Michelle Johnston Holthaus | | Annual Award PSU | 1,541,800 | 3,083,600 | 32,473 | 64,946 | | Sandra L. Rivera | | Annual Award PSU | 1,541,800 | 3,083,600 | 32,473 | 64,946 | | David A. Zinsner | | Annual Award PSU | 1,235,000 | 2,469,900 | 26,010 | 52,020 | | Christoph Schell | | Annual Award PSU | 1,650,900 | 3,301,900 | 32,251 | 64,502 | | George S. Davis | 2 | Annual Award PSU | N/A | N/A | N/A | N/A |
Summary Compensation Table
1The number of shares in the table represent the target and the maximum number of shares that each NEO could receive based on assumptions as of the grant date. However, the value ultimately received by the executives is dependent upon Intel’s stock price at the time of payout (as well as the satisfaction of the performance conditions). 2Mr. Davis retired from Intel on May 6, 2022, after stepping down as CFO effective as of January 17, 2022 and serving as an advisor until his retirement. He was not granted 2022 PSUs. Non-Equity Incentive Plan Compensation. The amounts in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table include annual incentive cash payments made under the Annual Cash Bonus Plan and the quarterly incentive cash program. The allocation of payments was as follows:
Summary Compensation Table
| Name | Year | Annual Incentive Cash Payments ($) | Quarterly Incentive Cash Payments ($) | Total Incentive Cash Payments ($) | | Patrick P. Gelsinger | 2022 | 945,900 | — | 945,900 | | | 2021 | 4,904,300 | 209,600 | 5,113,900 | | Michelle Johnston Holthaus | 2022 | 621,300 | 44,700 | 666,000 | | Sandra L. Rivera | 2022 | 604,300 | 44,700 | 649,000 | | | 2021 | 1,705,400 | 107,900 | 1,813,300 | | David A. Zinsner | 2022 | 600,700 | 34,000 | 634,700 | | Christoph Schell | 2022 | 503,500 | 14,800 | 518,300 | | George S. Davis | 2022 | — | 45,100 | 45,100 | | | 2021 | 2,177,500 | 137,900 | 2,315,400 | | | 2020 | 1,494,900 | 137,600 | 1,632,500 |
Summary Compensation Table
Change in Pension Value and Non-Qualified Deferred Compensation Earnings. Amounts reported represent the actuarial change of the benefit that the NEO (other than Messrs. Zinsner, Schell, and Davis) have in the tax-qualified pension plan and, for certain individuals, the supplemental benefit under the plan that offsets certain amounts under the non-qualified deferred compensation plan. Year-to-year differences in the present value of the accumulated benefit arise mainly from changes in the interest rate used to calculate present value and the participant’s age approaching 65. The NEOs generally had an overall decrease in 2022 compared to 2021 because the interest rate used to calculate present value increased from 2.9% for 2021 to 5.6% for 2022. Prior to 2011, when Mr. Gelsinger was a former Intel employee, he was a participant in the tax-qualified pension plan and the supplemental benefit. Upon rehire in 2021, Mr. Gelsinger is not eligible for additional pension benefits. Ms. Johnston Holthaus is a participant in the tax-qualified pension plan; however, was not eligible for the supplemental benefit. Ms. Rivera is a participant in the tax-qualified pension plan and the supplemental benefit. Messrs. Zinsner, Schell, and Davis are not eligible for pension benefits, as they were hired after January 1, 2011. For more information about the pension plan benefits, see below under “Pension Benefits for Fiscal Year 2022” on page 108.
Summary Compensation Table
| 2023 PROXY STATEMENT | 101 |
Summary Compensation Table
All Other Compensation for 2022. The amounts in the “All Other Compensation” column of the Summary Compensation Table include tax-qualified matching company contributions to the 401(k) savings plan, matching company contributions to the non-qualified deferred compensation plan, tax gross-ups, and payments for perquisites, as detailed in the table below. Perquisites for 2022 include financial planning, eligibility for health evaluations, company-provided transportation (including commuting), security, corporate travel card, travel fee costs, and company-matched charitable contributions.
Summary Compensation Table
| Name | Year | Retirement Plan Contributions1 ($) | Deferred Compensation Plan Contributions2 ($) | Tax Gross-Ups3 ($) | Financial Planning and Physicals ($) | Company-Provided Transportation4 ($) | Relocation5 ($) | Other6 ($) | | Patrick P. Gelsinger | 2022 | 15,300 | 294,700 | — | 27,500 | 147,600 | — | 12,000 | | Michelle Johnston Holthaus | 2022 | 15,300 | 76,400 | 600 | 10,800 | — | — | 11,100 | | Sandra L. Rivera | 2022 | 15,300 | 114,600 | — | 27,500 | — | — | — | | David A. Zinsner | 2022 | 15,300 | 4,100 | 85,400 | 27,500 | — | 100,500 | 107,900 | | Christoph Schell | 2022 | 15,300 | — | — | 7,500 | — | — | 300 | | George S. Davis | 2022 | 15,300 | — | — | 12,700 | — | — | 78,800 |
Summary Compensation Table
1Amounts included in the retirement plan contributions column become payable only upon the earliest to occur of retirement, termination of employment, disability, or death (receipt may be deferred following retirement or termination of employment but no later than reaching age 70.5). 2Amounts included in the deferred compensation plan contributions column will be paid to the NEOs after a fixed period of years or upon termination of employment, in accordance with irrevocable elections made in the calendar year before the calendar year in which that compensation is deferred. 3Amounts included in the tax gross-ups column for Ms. Johnston Holthaus represent equalization payments to offset taxes imposed on recognition awards she received prior to her becoming a NEO. Amounts to Mr. Zinsner represent equalization payments to offset taxes imposed on his relocation benefits, consistent with company-wide policy for relocation costs. 4For company-provided transportation costs (car service), the amount reported for Mr. Gelsinger represents the cost to Intel or, with respect to arrangements that are utilized both in business and non-business contexts, an allocation of the cost to Intel of the non-business component of such arrangements. 5Amounts represent payments to Mr. Zinsner for relocation benefits received upon joining Intel in 2022, consistent with company-wide policy for relocation costs. 6Amounts represent payments to Ms. Johnston Holthaus for recognition and cash compensation received prior to coming a NEO ($900); payments to Mr. Zinsner ($300) and Mr. Schell ($300) for health and welfare services, consistent with company-wide policy; payments to Mr. Gelsinger ($300) and Mr. Davis ($600) for corporate travel cards; payments to Ms. Johnston Holthaus ($200) for travel fees; payments to Mr. Gelsinger ($1,700) and Mr. Zinsner ($100,000 ) for residential security; and payments made by the Intel Foundation for matching charitable contributions on behalf of Mr. Gelsinger ($10,000), Ms. Johnston Holthaus ($10,000), and Mr. Zinsner ($7,600), in line with the guidelines of Intel’s employee charitable matching gift program and donation campaigns. Amounts for Mr. Davis include cash payments for accrued but unused sabbatical ($56,900) and payments related to the company’s late delivery of amounts owed to Mr. Davis ($21,300).
Summary Compensation Table
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Grants of Plan-Based Awards in Fiscal Year 2022
Grants of Plan-Based Awards in Fiscal Year 2022 The following table presents equity awards granted under the 2006 Equity Incentive Plan and awards granted under our Annual Cash Bonus Plan and quarterly incentive cash payments in 2022. Under SEC rules, the values reported in the “Grant Date Fair Value of Stock Awards” column reflect the grant date fair value of grants of stock awards determined under accounting standards applied by Intel, as discussed above.
Grants of Plan-Based Awards in Fiscal Year 2022
| | | | | Estimated Future Payouts Under Non-Equity Incentive Plans | | Estimated Future3 | | All Other Stock Awards: Number of Shares of Stock or Units (#) | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock Awards ($)2 | | Name | Grant Date | Approval Date | Award Type1 | Target ($)2 | Maximum ($) | Target (#) | Maximum (#) | | | | | Patrick P. Gelsinger | 1/31/2022 | 1/31/2022 | PSU | — | — | 108,455 | 216,910 | — | — | 5,149,400 | | | 1/31/2022 | 1/31/2022 | RSU | — | — | — | — | 81,342 | — | 3,720,200 | | | | | Annual Cash | 3,437,500 | 6,875,000 | | | | | | | | | | Quarterly Cash | — | | | | | | | | Michelle Johnston Holthaus | 1/31/2022 | 1/31/2022 | PSU | — | — | 32,473 | 64,946 | — | — | 1,541,800 | | | 1/31/2022 | 1/31/2022 | RSU | — | — | — | — | 97,421 | — | 4,455,600 | | | | | Annual Cash | 1,361,300 | 2,722,600 | | | | | | | | | | Quarterly Cash | 44,700 | | | | | | | | Sandra L. Rivera | 1/31/2022 | 1/31/2022 | PSU | — | — | 32,473 | 64,946 | — | — | 1,541,800 | | | 1/31/2022 | 1/31/2022 | RSU | — | — | — | — | 97,421 | — | 4,455,600 | | | | | Annual Cash | 1,361,300 | 2,722,600 | | | | | | | | | | Quarterly Cash | 44,700 | | | | | | | | David A. Zinsner | 1/31/2022 | 1/2/2022 | PSU | — | — | 57,537 | 115,074 | — | — | 2,731,900 | | | 1/31/2022 | 1/2/2022 | RSU | — | — | — | — | 305,030 | — | 13,828,700 | | | | | Annual Cash | 1,361,300 | 2,722,600 | | | | | | | | | | Quarterly Cash | 34,000 | | | | | | | | Christoph Schell | 3/30/2022 | 2/11/2022 | PSU | — | — | 32,251 | 64,502 | — | — | 1,650,900 | | | 3/30/2022 | 2/11/2022 | RSU | — | — | — | — | 96,753 | — | 4,827,100 | | | | | Annual Cash | 1,361,300 | 2,722,600 | | | | | | | | | | Quarterly Cash | 14,800 | | | | | | | | George S. Davis | 1/31/2022 | 1/31/2022 | RSU | — | — | | | 5,124 | | 244,500 | | | | | Annual Cash | 1,526,300 | 3,052,600 | | | | | | | | | | Quarterly Cash | 45,100 | | | | | | |
Grants of Plan-Based Awards in Fiscal Year 2022
1The Award type abbreviations are as follows: PSU - performance-based restricted stock units or Performance Stock Units that vest based on revenue growth percentage and cash flow from operations; RSU - restricted stock units.
Grants of Plan-Based Awards in Fiscal Year 2022
| 2023 PROXY STATEMENT | 103 |
Grants of Plan-Based Awards in Fiscal Year 2022
2Amounts reported as “Target” in the “Annual Cash” rows are the named executive officer’s annual incentive cash target, and the amounts reported as “Target” in the “Quarterly Cash” rows are the named executive officer’s 2022 aggregate quarterly incentive cash payments. Actual 2022 annual incentive cash payments are reported in the table under the heading “Non-Equity Incentive Plan Compensation” in the Summary Compensation Table. There is no threshold amount for the Annual Cash or Quarterly Cash Awards granted in 2022. 3The “Estimated Future Payouts Under Equity Incentive Plans” columns represent the target and maximum number of shares that could be received by each named executive officer (NEO); however, the value ultimately received by the named executive officer is dependent upon Intel’s stock price at the time of payout (as well as satisfaction of the performance conditions). In accordance with FASB ASC Topic 718, the grant date for performance-based awards is established when the performance objectives are set by the Compensation Committee. Because the Compensation Committee sets annual performance objectives for two of the financial metrics for the 2022 PSUs, the reported numbers for the target number of shares for the 2022 PSUs reflect the portion of the PSUs for which performance objectives were set in fiscal year 2022, or one-third of the total 2022 PSUs. There is no minimum number of shares that can be earned for the 2022 PSUs. Annual PSU Awards. PSUs granted to the NEOs in 2022 have a three-year performance period and vest on January 31, 2025. The number of shares of Intel common stock to be received at vesting will range from 0% to 200% of the target number of PSUs granted, based on our average achievement of annual performance objectives set by the Compensation Committee for each of 2022, 2023, and 2024 as to two financial metrics - revenue growth percentage (weighted 60%) and cash flow from operations (weighted 40%), with two modifiers that can each impact the overall score by plus or minus 25 points based on our achievement of three-year performance objectives for relative TSR (where target payout requires above median performance compared to the S&P 500 Index) and three-year performance objectives for revenue CAGR. Annual RSU Awards. RSUs granted to the NEOs in 2022 vest on a quarterly basis over the three years following the grant date. Annual Cash Bonus Plan. Payout under the Annual Cash Bonus Plan ranges from 0% to 200% of the NEO’s target opportunity. For more details regarding our Annual Cash Bonus Plan, see “ Annual Incentive Cash Compensation” beginning on page 83. Quarterly Incentive Cash Program. For more details regarding our quarterly incentive cash program, see “Quarterly Incentive Cash Compensation” on page 91.
Grants of Plan-Based Awards in Fiscal Year 2022
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Stock Option Exercises and Stock Vested in Fiscal Year 2022
Stock Option Exercises and Stock Vested in Fiscal Year 2022 The following table provides information on NEOs’ stock option exercises and vesting of RSUs and PSUs during fiscal year 2022.
Stock Option Exercises and Stock Vested in Fiscal Year 2022
| | | Option Awards | | Stock Awards | | | | Name | Grant Type | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | Total Value Realized on Exercise and Vesting ($) | | Patrick P. Gelsinger | Option | — | — | — | — | — | | | RSU | — | — | 213,131 | 8,113,400 | 8,113,400 | | | PSU | — | — | — | — | — | | Total | | — | — | 213,131 | 8,113,400 | 8,113,400 | | Michelle Johnston Holthaus | Option | — | — | — | — | — | | | RSU | — | — | 126,126 | 4,125,000 | 4,125,000 | | | PSU | — | — | 40,271 | 1,936,500 | 1,936,500 | | Total | | — | — | 166,397 | 6,061,500 | 6,061,500 | | Sandra L. Rivera | Option | — | — | — | — | — | | | RSU | — | — | 44,735 | 1,727,300 | 1,727,300 | | | PSU | — | — | 41,147 | 1,978,700 | 1,978,700 | | Total | | — | — | 85,882 | 3,706,000 | 3,706,000 | | David A. Zinsner | Option | — | — | — | — | — | | | RSU | — | — | 19,508 | 713,600 | 713,600 | | | PSU | — | — | — | — | — | | Total | | — | — | 19,508 | 713,600 | 713,600 | | Christoph Schell | Option | — | — | — | — | — | | | RSU | — | — | 24,188 | 884,800 | 884,800 | | | PSU | — | — | — | — | — | | Total | | — | — | 24,188 | 884,800 | 884,800 | | George S. Davis | Option | — | — | — | — | — | | | RSU | — | — | 43,574 | 2,136,100 | 2,136,100 | | | PSU | — | — | — | — | — | | Total | | — | — | 43,574 | 2,136,100 | 2,136,100 |
Stock Option Exercises and Stock Vested in Fiscal Year 2022
2019–2022 PSU Payout. In 2022, the payout for three-year performance period PSUs granted in 2019 was 52.2%. The performance metrics for the PSUs were relative TSR measured against the S&P 500 IT Index and three-year EPS growth rate. Intel’s TSR was 7.99%, which was 141.3 percentage points below the median TSR of the S&P 500 IT Index of 149.30% over the performance period. The relative TSR metric achieved 0% of target. The three-year EPS growth percentage was 4.0%, which was above the target goal of 3.8%. The cumulative EPS growth percentage metric achieved 104.4% of target.
Stock Option Exercises and Stock Vested in Fiscal Year 2022
| 2023 PROXY STATEMENT | 105 |
Outstanding Equity Awards at Fiscal Year-End 2022
Outstanding Equity Awards at Fiscal Year-End 2022 The following table provides information regarding outstanding equity awards held by the NEOs as of December 31, 2022. Unless otherwise specified, market value for stock awards (PSUs, RSUs, and Options) is determined by multiplying the number of shares by the closing price of Intel common stock on Nasdaq on the last trading day of the fiscal year (December 30, 2022).
Outstanding Equity Awards at Fiscal Year-End 2022
| | Stock Option Awards | | | | | | Stock Awards | | | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Equity Incentive Plan Awards Number of Securities Underlying Unexercised Unearned Options Unexercisable and Unearned (#)1 | Option Exercise Price ($) | Option Expiration Date | Market Value of Unexercised Options ($)2 | Grant Date | Award3 | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units, or Other Rights That Have Not Vested3 (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units, or Other Rights That Have Not Vested ($) | | Patrick P. Gelsinger | 2/15/2021 | — | 2,083,638 | 61.81 | 2/15/2031 | — | 2/15/2021 | RSU | 175,675 | 4,643,100 | | | | | | | | | | | 3/22/2021 | Invest RSU | 65,318 | 1,726,400 | | | | | | | | | | | 2/15/2021 | TSR PSU | | | 368,965 | 9,751,700 | | | | | | | | | 2/15/2021 | OUT PSU | | | 3,275,199 | 86,563,500 | | | | | | | | | 2/15/2021 | SG PSU | | | 457,789 | 12,099,400 | | | | | | | | | 1/31/2022 | RSU/PSU | 61,006 | 1,612,400 | 325,366 | 8,599,400 | | Total | | | 2,083,638 | | | — | | | 301,999 | 7,981,900 | 4,427,319 | 117,014,000 | | Michelle Johnston Holthaus | 3/13/2019 | — | 225,000 | 54.11 | 3/13/2029 | — | 3/13/2019 | PU | | | 56,250 | 1,486,700 | | | | | | | | | 1/30/2020 | RSU/PSU | 1,890 | 50,000 | 90,737 | 2,398,200 | | | | | | | | | 1/30/2021 | RSU/PSU | 11,321 | 299,200 | 108,684 | 2,872,500 | | | | | | | | | 11/30/2021 | RSU | 154,334 | 4,079,000 | | | | | | | | | | | 1/31/2022 | RSU/PSU | 73,066 | 1,931,100 | 97,421 | 2,574,800 | | Total | | | 225,000 | | | — | | | 240,611 | 6,359,300 | 353,092 | 9,332,200 | | Sandra L. Rivera | 3/13/2019 | — | 225,000 | 54.11 | 3/13/2029 | — | 3/13/2019 | PU | | | 56,250 | 1,486,700 | | | | | | | | | 1/30/2020 | RSU/PSU | 1,620 | 42,800 | 77,774 | 2,055,600 | | | | | | | | | 1/30/2021 | RSU/PSU | 9,057 | 239,400 | 86,947 | 2,298,000 | | | | | | | | | 1/31/2022 | RSU/PSU | 73,066 | 1,931,100 | 97,421 | 2,574,800 | | Total | | | 225,000 | | | — | | | 83,743 | 2,213,300 | 318,392 | 8,415,100 | | David A. Zinsner | | | | | | | 1/31/2022 | RSU/PSU | 285,522 | 7,546,300 | 172,614 | 4,562,200 | | Total | | | — | | | — | | | 285,522 | 7,546,300 | 172,614 | 4,562,200 | | Christoph Schell | | | | | | | 3/30/2022 | RSU/PSU | 72,565 | 1,917,900 | 96,753 | 2,557,200 | | Total | | | — | | | — | | | 72,565 | 1,917,900 | 96,753 | 2,557,200 | | George S. Davis 4 | | | | | | | | | | | | | | Total | | | — | | | — | | | — | — | — | — |
Outstanding Equity Awards at Fiscal Year-End 2022
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Outstanding Equity Awards at Fiscal Year-End 2022
1The Options vest in four equal installments, with the first vesting commencing on the first anniversary of the grant date, the second vesting on February 1, 2021, the third vesting on February 1, 2022, and the last vesting on February 1, 2023, and become exercisable only upon achieving the threshold stock price hurdle and maintaining the price for 30 consecutive trading days by February 1, 2024. The Options have a 10 year expiration date. 2The Market Value of Unexercised Options is determined by multiplying the number of unvested stock options by the closing price of Intel common stock on Nasdaq on the last trading day of the fiscal year (December 30, 2022) minus the option’s exercise price. 3RSUs, PSUs, Performance Units (PU), CEO Performance Stock Options (Perf SO), CEO Strategic Growth PSUs (SG PSU), CEO TSR PSUs (TSR PSU), CEO Outperformance PSUs (OUT PSU), and CEO Investment RSUs (Invest RSU) are shown at their target amount. Unless otherwise noted and in each case, subject to continued employment through the applicable vest dates: ▪The RSUs vest quarterly over a three-year period from the grant date. ▪The 2022 PSUs have a three-year performance period from the start of the fiscal year of the grant date and will vest on January 31, 2025, based on our average achievement of annual performance objectives set by the Compensation Committee for each of 2022, 2023, and 2024 as to two financial metrics - revenue growth percentage (weighted 60%) and cash flow from operations (weighted 40%), with two modifiers that can each impact the overall score by plus or minus 25 points based on our achievement of three-year performance objectives for relative TSR (where target payout requires above median performance compared to the S&P 500 Index) and three-year performance objectives for revenue CAGR. The 2022 PSUs are shown above at the target amount that may be earned at the end of the three-year performance period; however in accordance with SEC and accounting standard rules, only one-third of the target number of 2022 PSUs granted are shown in the Summary Compensation Table and Grants of Plan-Based Awards in Fiscal Year 2022 table above. ▪The PSUs granted in 2020 and 2021 have a three-year performance period from the start of the fiscal year of the grant date and will vest on the 37th month anniversary of the start of the performance period, based on Intel’s TSR performance relative to the S&P 500 IT Index (50%) and Intel’s cumulative EPS growth against an EPS growth target over the three-year performance period (50%). ▪The Performance Units will vest based on certain stock price hurdles over a five-year period and 50% of any vested PUs will be settled on February 1, 2022 and the remaining vested PUs will be settled on February 1, 2024. No PUs were earned or settled on February 1, 2022. ▪The Perf SOs vest in four equal installments, with the first vesting commencing on the first anniversary of the grant date, the second vesting on the second anniversary of the grant date, the third vesting on the third anniversary of the grant date, and the last vesting on the fourth anniversary of the grant date, and become exercisable only upon achieving the threshold stock price hurdle and maintaining the price for 30 consecutive trading days by February 15, 2026. The Perf SO have a ten year expiration date. ▪The TSR PSUs have a three-year performance period from the start of the fiscal year of the grant date and will vest based on Intel’s TSR performance relative to the S&P 500 IT Index over a three-year performance period. ▪The OUT PSUs will vest based on certain stock price hurdles over a five-year period. 50% of any earned shares will be eligible to vest on the third anniversary after the grant date, the remainder of earned shares will vest on the fifth anniversary of the grant date. ▪The SG PSUs will vest based on certain stock price hurdles over a five-year period. 50% of any earned shares will be eligible to vest on the third anniversary after the grant date, the remainder of earned shares will vest on the fifth anniversary of the grant date. ▪The Invest RSUs vest quarterly over a three-year period from the grant date. 4Mr. Davis retired from Intel on May 6, 2022.
Outstanding Equity Awards at Fiscal Year-End 2022
| 2023 PROXY STATEMENT | 107 |
Pension Benefits for Fiscal Year 2022
Pension Benefits for Fiscal Year 2022 The following table shows the estimated present value of accumulated pension benefits for the NEOs.
Pension Benefits for Fiscal Year 2022
| Name | Plan Name | Number of Years of Credited Service (#) | Present Value of Accumulated Benefit1,2 ($) | | Patrick P. Gelsinger | Pension Plan | N/A | 1,235,000 | | Michelle Johnston Holthaus | Pension Plan | N/A | — | | Sandra L. Rivera | Pension Plan | N/A | 45,000 | | David A. Zinsner | Pension Plan | N/A | N/A | | Christoph Schell | Pension Plan | N/A | N/A | | George S. Davis | Pension Plan | N/A | N/A |
Pension Benefits for Fiscal Year 2022
1Until distribution, these benefits are also reflected in the named executive officer’s balance reported in the Non-Qualified Deferred Compensation table. The amounts of these tax-qualified pension plan arrangements are not tied to years of credited service. Upon termination, the amount that the named executive officer receives under the non-qualified deferred compensation plan will be reduced by the amount received under the tax-qualified pension plan arrangement. Messrs. Zinsner, Schell, and Davis are not eligible for pension benefits as they were hired after January 1, 2011. 2Mr. Gelsinger has pension benefits, which were earned when he was a former Intel employee prior to 2011. The US Intel Minimum Pension Plan is a tax-qualified defined benefit plan with two components. The first component provides participants with retirement income that is determined by a pension formula based on final average compensation, Social Security-covered compensation, and length of service upon separation not to exceed 35 years. It provides pension benefits only if the annuitized value of a participant’s account balance in Intel’s tax-qualified retirement contribution plan is less than the pension plan benefit, in which case the pension plan funds a net benefit that makes up the difference. As of December 31, 2022, Ms. Rivera’s amount included in the table above has a portion associated with this component. Effective January 1, 2015, compensation earned and service accruals were frozen as of December 31, 2014 in the US Intel Minimum Pension Plan for all employees at or above a specific grade level, including all named executive officers. The second component is an arrangement under which pension benefits offset amounts that otherwise would be paid under the non-qualified deferred compensation plan described below. Employees who were participants in the non-qualified deferred compensation plan as of December 31, 2003 were able to consent to a one-time change to the non-qualified deferred compensation plan’s benefit formula. This change reduces the employee’s distribution amount from the non-qualified deferred compensation plan by the lump sum value of the employee’s tax-qualified pension plan arrangement at the time of distribution. Each participant’s pension plan arrangement was established as a fixed, single-life annuity amount based on assumed retirement at age 65. Each participant’s benefit was set based on a number of elements, including his or her non-qualified deferred compensation plan balance as of December 31, 2003, IRS pension rules that consider age and other factors, and limits that Intel sets for equitable administration. Mr. Gelsinger elected to participate when he was a former Intel employee. As of December 31, 2022, Ms. Rivera's amount included in the table above has a portion associated with this component. Ms. Johnston Holthaus and Messrs. Zinsner, Schell, and Davis were not eligible to participate in these arrangements. The benefit under both components of the plan are frozen, and accordingly, year-to-year differences in the present value of the accumulated benefit arise mostly from changes in the interest rate used to calculate present value and the participant’s age becoming closer to age 65. We calculated the present value assuming that the named executive officers will remain in service until age 65, using the interest rate and other assumptions used by Intel for financial statement accounting, as reflected in Note 17 to the financial statements in our 2022 Annual Report on Form 10-K for the year ended December 31, 2022. An officer who terminates service before age 65 can elect to receive his or her benefits at any time following termination of employment, but not later than age 65. If such officer works past age 65, then his or her benefits must start upon termination of employment. Distributions before age 55 may be subject to a 10% federal penalty tax.
Pension Benefits for Fiscal Year 2022
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Non-Qualified Deferred Compensation for Fiscal Year 2022
Non-Qualified Deferred Compensation for Fiscal Year 2022 The following table shows the non-qualified deferred compensation activity for each NEO during fiscal year 2022.
Non-Qualified Deferred Compensation for Fiscal Year 2022
| Name | Executive Contributions in Last Fiscal Year1 ($) | Intel Contributions in Last Fiscal Year2 ($) | Aggregate Earnings (Losses) in Last Fiscal Year3 ($) | Aggregate Balance at Last Fiscal Year-End4 ($) | | Patrick P. Gelsinger | 700,100 | 294,700 | (97,700) | 665,600 | | Michelle Johnston Holthaus | 76,400 | 76,400 | (50,500) | 523,900 | | Sandra L. Rivera | 1,595,300 | 114,600 | (1,893,300) | 7,314,900 | | David A. Zinsner | 4,100 | 4,100 | — | 4,100 | | Christoph Schell5 | — | — | — | — | | George S. Davis5 | — | — | — | — |
Non-Qualified Deferred Compensation for Fiscal Year 2022
1Amounts included in the Summary Compensation Table in the “Salary” and “Non-Equity Incentive Plan Compensation” columns for 2022. 2These amounts, which accrued during fiscal year 2022 and were credited to the participants’ accounts in 2023, are included in the Summary Compensation Table in the “All Other Compensation” column for 2022. 3These amounts are not included in the Summary Compensation Table because plan earnings were not preferential or above market. 4These amounts are as of December 31, 2022 and do not take into account the amounts in the "Intel Contributions in Last Fiscal Year" column in the table above that were accrued during fiscal year 2022 but were credited to the participants' accounts in 2023. The following amounts are included in the fiscal year-end balance and previously were reported as compensation to the NEOs in the Summary Compensation Table for 2019 through 2022 (except for Mr. Gelsinger and Ms. Rivera who were not NEOs prior to 2021; Ms. Johnston Holthaus who was not a NEO prior to 2022; Messrs. Zinsner and Schell who joined Intel in 2022): Mr. Gelsinger $31,300 and Mrs. Rivera $1,322,800. 5Messrs. Schell and Davis did not elect to defer into the plan in 2022. Intel will distribute the balances reported in the Non-Qualified Deferred Compensation table (plus any future contributions or earnings) to the NEOs in the manner that the officers have chosen under the plan’s terms. Some balances reported in the table above include the offset amount that the employee would receive under the tax-qualified pension plan arrangement; the actual amount distributed under this plan will be reduced by the benefit under the pension plan arrangement. See the Pension Benefits table on page 108 for these amounts. The following table summarizes the total contributions made by the participant and Intel, including gains, losses, and distributions attributable to such contributions, that were previously reported (or that would have been reported had the participant been a NEO for all years) in the Summary Compensation Table over the life of the plan. The amounts in the table are as of December 31, 2022 and do not take into account any amounts that were accrued during fiscal year 2022 but were credited to the participants’ accounts in 2023.
Non-Qualified Deferred Compensation for Fiscal Year 2022
| Name | Aggregate Executive Deferrals over Life of Plan ($) | Aggregate Intel Contributions over Life of Plan ($) | | Patrick P. Gelsinger | 637,900 | 27,700 | | Michelle Johnston Holthaus | 84,700 | 439,200 | | Sandra L. Rivera | 6,795,000 | 519,900 | | David A. Zinsner | 4,100 | — | | Christoph Schell | — | — | | George S. Davis | — | — |
Non-Qualified Deferred Compensation for Fiscal Year 2022
Intel’s non-qualified deferred compensation plan allows certain highly compensated employees, including NEOs, to defer up to 60% of their salary and up to 75% of their annual incentive cash payment. Gains on equity compensation are not eligible for deferral. Beginning in 2020, Intel began making matching contributions on employee deferrals into the plan. Matching contributions are 100% vested. All NEOs who made deferral contributions received matching contributions. Messrs. Schell and Davis did not elect to defer into the plan, so they did not receive matching contributions. For 2019 and earlier, Intel made company contributions to the employee’s account representing the portion of Intel’s retirement contribution on eligible compensation (consisting of base salary and annual and quarterly incentive cash payments) earned in excess of the tax code annual compensation limit. These company contributions are subject to the six-year graded vesting provisions in the retirement contribution plan. In addition, these contributions vest upon death, disability, or reaching age 60. Mr. Gelsinger and Mses. Johnston Holthaus and Rivera are fully vested in the value of company contributions, as they have each completed more than six years of service or reached the age of 60. Messrs. Zinsner, Schell, and Davis were not eligible for company contributions, as they joined Intel in January 2022, March 2022, and April 2019, respectively.
Non-Qualified Deferred Compensation for Fiscal Year 2022
| 2023 PROXY STATEMENT | 109 |
Equity Award Termination Provisions
Equity Award Termination Provisions ▪Unvested PSUs are canceled upon termination of employment for any reason other than retirement, death, or disability. In the event of retirement under the Rule of 75 (when the holder’s age and years of service equal at least 75) or reaching the age of 60 for grandfathered employees, the number of PSUs eligible for accelerated vesting will be prorated by the number of months employed during the 36 month performance period if the retirement occurs within the first calendar year of the grant date; if retirement occurs after the first calendar year, then the PSUs are fully vested. In the event of retirement under the Rule of 75 or reaching the age of 60 with five years of services for non-grandfathered employees, the number of PSUs eligible for accelerated vesting will be prorated by the number of months employed during the 36-month performance period. Any vested PSUs are settled into shares of Intel stock based on actual performance results after the end of the performance period. ▪RSUs are subject to retirement vesting under the rule of Age 60 or the Rule of 75, but not both. Upon retirement under the rule of Age 60, the holder receives one additional year of vesting for every five years of service. Upon retirement under the Rule of 75, the holder receives one additional year of vesting. Additional years of vesting means that any RSUs scheduled to vest within the number of years from the retirement date determined under the rule of Age 60 or Rule of 75 will be vested on the holder’s retirement date. ▪Upon disability or death, all unvested PSUs and RSUs become 100% vested.
Equity Award Termination Provisions
| 2023 PROXY STATEMENT | 111 |
Equity Award Termination Provisions
Additional Compensation Matters
CEO Pay Ratio
CEO Pay Ratio In accordance with SEC rules, we are providing the ratio of the annual total compensation of our CEO to the annual total compensation of our median employee. The 2022 annual total compensation of our CEO Mr. Gelsinger is $11,614,700, the 2022 annual total compensation of our median compensated employee is $96,400, and the ratio of these amounts is 120 to 1. This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our human resources system of record and the methodology described below. Because the SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and types of workforces, may operate in different countries, and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios. We are a global company with more than 55% of our employees located outside the US and significant manufacturing operations. As a result, our employee population is different than that of other companies. As permitted under the SEC rules, we are using the same median employee identified for purposes of last year’s CEO pay ratio, as we believe the changes to our employee population and compensation have not significantly impacted our ratio. Our median employee works in Malaysia as a full-time program manager, which is a non-technology position. For purposes of identifying our median compensated employee as of our measuring date of December 25, 2021 (the last day of our fiscal year for 2021), we used total direct compensation as our consistently applied compensation measure. In this context, total direct compensation means the applicable annual base salary determined as of December 25, 2021, the annual incentive cash target amount or commission target amount payable for service in 2021, and the approved value of the annual equity awards granted during 2021, which we annualized for all permanent employees who did not work for the entire year. To identify our median compensated employee last year, we then calculated the total direct compensation for our global employee population and used the foreign currency exchange rates in effect at the end of the fiscal year 2021. As of 2022 fiscal year-end, we had 131,900 worldwide employees, and approximately 79% of our US employees’ total direct compensation exceeds our median employee’s total direct compensation.
CEO Pay Ratio
| 112 | |
Pay Versus Performance
Pay Versus Performance This disclosure has been prepared in accordance with the SEC’s pay versus performance rules in Item 402(v) of Regulation S-K under the Securities Exchange Act of 1934, as amended, and does not necessarily reflect the value of compensation actually realized by the NEOs or how the Compensation Committee evaluates compensation decisions. Amounts included as “compensation actually paid” do not represent the value of cash compensation and equity awards actually received by the NEOs, but rather is an amount calculated under SEC rules that includes, among other things, the year-over-year changes in the “fair value” of unvested equity-based awards. For discussion of how the Compensation Committee seeks to align pay with performance when making compensation decisions, please review the Compensation Discussion and Analysis beginning on page 71. The following table shows the information for the past three fiscal years of: (i) the Summary Compensation Table total compensation (see page 99) for our principal executive officer (PEO) and, on an average basis, our Non-PEO NEOs, (ii) the “compensation actually paid” to our PEO(s) and, on an average basis, our Non-PEO NEOs (in each case, as determined in accordance with SEC rules), (iii) our total shareholder return, (iv) our peer group total shareholder return, (v) our net income, and (vi) our revenue.
Pay for Performance Table
| Year1 (a) | Summary Compensation Table Total for PEO Robert H. Swan (b) | Compensation Actually Paid to PEO Robert H. Swan2,3 (c) | Summary Compensation Table Total for PEO Patrick P. Gelsinger (b) | Compensation Actually Paid to PEO Patrick P. Gelsinger2,4 (c) | Average Summary Compensation Table Total for Non-PEO NEOs (d) | Average Compensation Actually Paid to Non-PEO NEOs2,5 (e) | Value of Initial Fixed $100 Investment Based On:6 | | Net Income (in billions) (h) | Revenue (Non-GAAP)* (in billions)7 (i) | | | | | | | | | Total Shareholder Return (f) | Peer Group Total Shareholder Return (g) | | | | 2022 | N/A | N/A | $11,614,700 | ($78,501,522) | $12,812,380 | $5,207,059 | $48.06 | $138.70 | $8.0 | $63.1 | | 2021 | $605,300 | ($26,428,474) | $178,590,400 | $124,177,488 | $10,538,800 | $2,003,497 | $89.75 | $192.25 | $19.9 | $74.7 | | 2020 | $22,389,500 | ($41,412,608) | N/A | N/A | $10,896,140 | ($10,755,073) | $80.28 | $142.28 | $20.9 | $72.9 |
Relationship Between “Compensation Actually Paid” and Performance Measures
Relationship Between “Compensation Actually Paid” and Performance Measures In accordance with SEC rules, the charts below illustrate how “compensation actually paid” (CAP) to our NEOs aligns with our company’s financial performance as measured by our total shareholder return, our peer group total shareholder return, our net income, and our revenue (non-GAAP).
Compensation Actually Paid vs. Intel TSR & S&P 500 IT Index TSR
Compensation Actually Paid vs. Intel TSR & S&P 500 IT Index TSR
Compensation Actually Paid vs. Net Income and Revenue (Non-GAAP)
Compensation Actually Paid vs. Net Income and Revenue (Non-GAAP)
Compensation Actually Paid vs. Net Income and Revenue (Non-GAAP)
| 2023 PROXY STATEMENT | 115 |
Compensation Actually Paid vs. Net Income and Revenue (Non-GAAP)
| 4 | Approval of Amendment and Restatement of the 2006 Equity Incentive Plan (EIP) ▪Long-term equity compensation helps to attract, motivate, and retain talent ▪The 2006 EIP and our equity compensation programs reflect leading corporate governance practices ▪Equity awards are broadly granted to eligible members of Intel’s workforce (e.g., ~98% of Intel’s workforce received an equity award in 2022) ▪Increase of the 2006 EIP share reserve necessary for appropriate implementation of planned compensation actions for 2023 | | | | | Recommendation of the Board The Board recommends that you vote “FOR” approval of the amendment and restatement of the 2006 EIP. |
Compensation Actually Paid vs. Net Income and Revenue (Non-GAAP)
The Board is requesting that stockholders vote in favor of amending the 2006 Equity Incentive Plan (2006 EIP) to add 150 million shares to the share reserve. Since the 2006 EIP was first adopted in 2006, it has been our practice to present it to stockholders for re-approval regularly and frequently to allow stockholders to review our use of equity compensation and to vote upon the continued use of the 2006 EIP. If this Proposal is approved, the term of the 2006 EIP will extend to 2026; if not approved, the share reserve under the 2006 EIP will not be increased and the 2006 EIP will terminate in 2025. Intel has a long-standing practice of granting equity awards not only to its executives and directors, but also broadly among its employees. As of December 31, 2022, Intel had 131,900 employees, all of whom are eligible to receive awards under the 2006 EIP, and of which approximately 98% received an equity award in 2022. The 2006 EIP authorizes us to grant four types of equity awards: stock options, stock appreciation rights (SARs), restricted stock, and restricted stock units (RSUs). In practice, we have used the 2006 EIP to grant time-based RSUs, performance-based RSUs or Performance Stock Units (PSUs), and stock options. Please note that the following summary of major features of the amended and restated 2006 EIP is qualified in its entirety by reference to the actual text of the amended and restated 2006 EIP, which is included as Appendix C beginning on page C-1 to this proxy statement.